The evolving role of AI and Data Analytics for the Banking Industry

By Kartikeyan Gopalkrishnan, Executive Vice President of International Business at Teleperformance India. 

Discusses how financial services are digitally transforming to keep up with evolving post-pandemic trends.

Global Artificial Intelligence (AI) spend has grown at a staggering rate of32 per cent this year[1], due to an urgent demand for new capabilities as the industry navigates this new normal landscape.  COVID-19 has rapidly become a business disruptor, exposing the shortcomings of legacy infrastructures that have failed to scale with the increasing levels of demand. Archaic frameworks lack the agility to identify and respond to market changes, due to an over-reliance on manpower. But challenger banks, built on cloud-native technology and often utilising a mobile workforce, are keeping pace with minimal disruption.With limited face-to-face customer interaction available, and all five generations now able to navigate the digital space more confidently, traditional financial organisations are now expected to exceed the growing expectations for digital offerings.

Opening the digital front door

The continuing shift from traditional to online banking models has accelerated significantly this year,thanks to the enforced closure of brick-and-mortar branches.Customers who may have originally resisted digital banking have now adapted to using online banking or apps,and may never switch back. Between 14^th of March and 14^th of April alone, some six million people downloaded their bank’s app for the first time[2] – and this is not set to slow down. These interfaces, or digital front doors,have become a catalyst for the transition to a cashless society, presenting banks with new opportunities to tap into the emerging platform economy,and retain post-crisis loyalty.

The increased appetite for seamless communication and personalised services,has meant that companies must now develop mobile-first alternatives.By leveraging AI to collect customer interaction data and monitor pain-points, the banking industry will be able to design enriched end-to-end digital experiences that gain the maximum level of value possible. Interactive features – such as voice banking and chat with live agents – are set to dominate the banking industry, as consumers strive for more channels to easily make transactions, transfer money, and report issues.

Bottom up automation

A digital first strategy enables the financial services industry to provide swift customer service, and to operate in an increasingly cost-efficient way. This frees up time for human agents to offer customers empathy where it is needed most – something that is becoming vital to seamless communication. With continued disruption to customers’ financial services experience, customer contact levels are soaring, and each features a different level of complexity. In response, companies should be taking advantage of Robotic Process Automation (RPA), to learn patterns and make the most of agents’ time in this constantly evolving landscape.

Several government-backed financial support packages this year, including mortgage holidays and business loans,require customer service teams to move at unprecedented speeds to address enquiries. With the emotional state of the customer influencing the overall brand experience, companies are re-evaluating how technology can be used to manage caller frustration, and earn trust. In addition to taking over repetitive data-entry and other processes vulnerable to human error, RPA also triages case urgency, empowering overstretched human agents to navigate cases and successfully engage with distressed customers.

Building cyber resilience

As cybercriminals seek to expose vulnerabilities in company networks, organisations must take a holistic view of their ecosystem, and monitor fraud at a more granular level.Between February and April this year, cyber-attacks against the financial sector surged 238 per cent[3], as hackers sought to exploit the crisis. The European Central Bank has now warned banks to prepare for a further surge, urging them to test the capacity of IT systems amidst higher reliance on remote banking services.

To safeguard accounts and build trust in the digital era, it has never been more important for banks to explore the applications of AIto make remote working scenarios safer. Machine learning technologies can track account behaviours and predict potential data breaches in real-time – and in comparison to human agents, the processing speeds are much faster. The ability to analyse an influx of data 24/7 will prove invaluable in protecting against threats– potentially saving millions in losses, and instilling confidence in data security within customers.

The future of the financial services

The post-pandemic landscape is redefining the way in which the banking industry is adopting AI and automation. With increased competitive pressures, understanding the different ways companies can lean on technology – to both retain customers, and ensure business continuity -will be a pivotal concern for organisations.With key efficiencies to be gained, companies are now strengthening their AI capabilities, to enhance data-driven online experiences, and solidify their reputation as reliable and resilient partners in this post-COVID-19 era.