By now, you’ve undoubtedly heard the terms “artificial intelligence” and “machine learning”. If you haven’t already, take a quick read of our previous article where we explain the basics of machine learning.
Today, banks and credit unions are learning how to use the power of artificial intelligence (AI) to boost customer engagement, decrease costs, improve revenue, and pin-point fraud. AI is poised to truly revolutionize the way financial institutions gather information, harness data and interact with customers and members.
So, what exactly is AI?
AI all started out as science fiction: computers that can talk and think like humans. Industry experts use the term artificial intelligence as an umbrella term that includes multiple technologies, such as machine learning, deep learning, and computer vision. AI is the general field that covers everything that has anything to do with programming machines with “intelligence,” with the goal of emulating a human’s unique reasoning ability. Think of AI as developing computer systems to perform tasks that normally require human intelligence, such as visual perception, speech recognition, decision-making, translation between languages, and much more.
Uses Cases and The Power of AI
From Google’s development of the driverless cars to Skype’s launch of real-time voice translation, AI is now becoming an everyday reality that is changing aspects of our lives. To give you a better idea of how AI is becoming more prevalent and how it’s evolved, here’s a short list of popular AI use cases and some applications FI’s are widely embracing today:
Voice enabled assistants. Did you know the first tool enabled to perform digital speech recognition was the IBM Shoebox, presented at the 1962 World’s Fair? Today, everyone is familiar with voice assistants and other smart device voice technologies. As more and more people gain familiarity with voice assistance to quickly gather information, we will be seeing an increase in acceptance of and a rise in the demand for other applications that rely on voice enabled technology. From healthcare to driving directions to workspace operations, this form of AI can make a significant impact on how businesses operate.
Financial services are a high-profile industry for voice assistance. In December 2017, Jack Henry’s Symitar® division introduced voice-enabled financial transactions to Amazon® Alexa® through its Financial Innovations Voice Experience (FIVE) solution. Consumers can simply speak to Alexa to conduct a wide variety of transactions such as: check account balances, transfer funds, make payments, get loan payoff amounts, cancel payment cards, and more.
Smart Assistants: Smart assistants and home robots like Aido have come into the domestic scene. From assisted healthcare to automated customer service, consumers are experiencing the power of smart machines all the time. Even the Drone technology has been re-designed to accomplish tasks for you autonomously by a command on your smart phone.
The capabilities and usage of smart assistants is expanding rapidly, with new products entering the market. An online poll found the most widely used in the US were Apple’s Siri (34%), Google Assistant (19%), Amazon Alexa (6%), and Microsoft Cortana (4%).
Marketing Automation: Retailers and big brands are investing in the power of AI to further personalize and customize marketing emails based on customer preferences and behavior to engage them more and to prompt consumers to make a purchase. AI tools and software allow companies to send customized email newsletters based on previous interactions recipients have had with content to create a richer, more engaging brand image.
Risk Management: Fraud detection and risk management is an imperative focus for banks and credit unions. That’s why AI is being applied to fraud mitigation technology at a rapid pace. Through AI and algorithms, financial institutions are more effectively mining data to uncover suspicious activity and meaningful patterns, which then translates to information used to detect, spot, and mitigate fraud. Using AI to identify accounts, customers or transactions, for instance, that have unusual characteristics can expedite warning signs of abnormalities and verify suspicious activity that fraud is taking place.
Analytic Tools: Financial institutions realize they have a head start with the application of AI, since they have large data sets and experience with analytical tools. Improving the customer experience is one of the greatest use cases for banks and credit unions since AI and advanced data analytics provides the opportunity for improved and faster decision making by deriving deep and actionable insights (e.g. customer behavior patterns). Some of these interactions will be with new voice or chatbot technology, while other applications will be behind the scenes, supporting marketing communication.
The use cases of AI are limitless—especially for financial institutions. AI helps us open our minds to how machines can help perform task more efficient and more accurate, while delivering greater overall results.
By partnering with right data analytic professionals, the power of AI and the insights it leads to can be realized faster, ultimately determining the financial institutions’ competitive differentiation in the future. If you have questions regarding AI or machine learning, contact The Knowlton Group today.
Financial Brand: How FI are Turing AI into ROI. Sept. 2017
USA Today: June 5, 2017: Apple Unveils $349 HomePod to bring voice to home audio
Dataversity: AI overview May 2017
Internet of Things: Tech Target