AI (Artificial Intelligence) was invented to automate and make human tasks easier. Many industries have achieved tremendous benefits through the development of AI. In the early days, banks required a room full of people to keep record of their transactions. However, now it is all taken care of by computers and highly effective AI systems. Today, clients are more happy to deal with banks that provide a personalized service.
The banking sector use artificial intelligence to provide a tailor-made service to their customers. Banks use AI for many reasons, mainly to provide a customised service, provide quick and convenient service, detect frauds, tighten security and to gain a competitive advantage.
Fraud is a major concern among banks especially because it damages the image of trust and assurance that banks are expected to represent. Online banking and email scams are common in the banking sector. UK bank customers lost £500m to scams in first half of 2018 alone. Banks need to ensure that their clients’ data is secured and well-protected. Artificial Fraud. Detection (AFD) was one of the primary purposes for which artificial intelligence technology was used in banking. The AFD help banks to monitor frauds better but also respond to potential fraud in real-time.
Another AI application integrated into the banking sector is Chatbot. These are automated chat systems which simulate human chats without any human interventions. Chatbots identify the context and emotions in the text chat sent by humans and respond to them most appropriately with the best possible solution. Chatbots are most likely to pick up mass amount of data from the behaviour and habits of the end-user and learn to provide solutions that satisfies the requirements of the end-user or customer.
Recommendation engines are developed using past data about users and many services offered by the banks like credit card plans, investment strategies, funds, financial services, etc., to provide the most appropriate recommendation to the user, based on their preferences and the users’ history. Recommendation engines are very successful and a key component in revenue growth accomplished by major banks in recent times.
Banks can benefit greatly by the implementation of AI. Increase usage of online banking and transactions made through payment platforms and cards increase the risk of fraud and directly affects the bank’s reputation as a trusted entity. Hence AI can work wonders for banks around the world to strengthen the security of global transactions. Banks are quick to adapt to AI innovation and has confirmed the AI is here to stay.