FFCON21 Breaking Barriers May 11-13, 2021

Using AI to Enrich the Customer Experience

Grow Technologies | Jesse Penner | Jan 23, 2019

AI and big data - Using AI to Enrich the Customer Experience“Is AI going to replace us?”

This is a concern we hear most often – that service providers, like the financial institutions we work with, will end up being replaced by algorithms.

As I noted in the discussion “Pioneering Markets: Game Changing Tech Innovations Impacting Finance and Society” AI isn’t seeking to replace financial advisors whose guidance customers value. Rather, AI will augment and improve the overall value that the financial service provider is able to present.

The threat of tech giants like Amazon and Google and consumer focussed fintechs that are seeking to cut out financial institutions altogether means traditional banks will need to do more than offer marginal savings on fees to win the long-game.

See:  Designing a data transformation that delivers value right from the start

Their key differentiator will be a brand that people trust, and customer experience.

The benefits of AI applied to the banking experience don’t just apply to those customers on their mobile phones, but can provide greater insight to advisors in branch for a more effective banking relationship. AI is improving the customer experience by providing an overall more consistent, hyper-personalized omnichannel experience for every customer.

The Challenge

Financial institutions are well aware that different customer segments prefer different types of access and service – self-serve, in branch, on mobile, at home, one-to-one.

Irregardless of how they prefer to consume service whether it’s on mobile or on their laptop at home, 87% of banking customers still want advice and guidance from their bank.

Unfortunately, the industry is currently falling short of meeting those expectations. As digital adoption increases, customer satisfaction is dropping, and customer satisfaction is lowest among digital only segments. Today’s consumers want it all: digital self-service convenience and personal relationships.

Why it matters

In a recent report released by Kantar, customer experience leaders earned 1.9x greater wallet share than others and 1.9x greater level of recommendation. Additionally, customer experience leaders’ customers are 2.1x more willing to take up new products.

Improving customer experience isn’t just strategic lip service - it’s imperative for traditional banks to remain competitive. So how do financial institutions meet the challenge of human personalization in increasingly device and digital-driven services?

See:  Differences Between AI and Machine Learning and Why it Matters

Enter big data

The intersection of AI and financial technology is inevitable because it’s one of the areas AI can add the most value. Financial data, with everyone in Canada utilizing banking services in some way, presents a hugely detailed data set for learning. After all, without data sets and application that solves tangible problems, AI isn’t really doing much for anyone.

The opportunity we have here to make a material impact on people’s lives is significant.

Analysis and the AI insights driven by financial data can help answer questions like “Should I go back to school?” or “Would I be better off if I moved to Calgary?”

 

These are huge life decisions where the information that supports different choices are from disparate or unreliable, anecdotal sources.

Aggregating and analyzing financial data means a service provider could give informed, real-time advice based off more information gleaned in 5 seconds than they could learn in a decade of face to face meetings. That advice could be delivered in person or through a mobile phone depending on the customer’s preference.

Ultimately it’ll be the technology whose incentives aligns with the end user that will win out. By aligning with end users desire for success and need for guidance, banks and credit unions will retain the service-driven edge that many consumers expect and actually far exceed these expectations as their insights become smarter and more valuable. Banking customers will get the most out of their financial service providers, as opposed to more products.

See:

Enter open banking?

Given how quickly tech giants and consumer fintechs are moving in an effort to eat up market share, open banking could help level the playing field by enabling financial institutions to take advantage of product-focused fintechs who can offer immediate solutions and improve customer experience faster than they could do themselves. While banks and credit unions have the benefits of deep industry knowledge, trust and customer-centric services, taking advantage of the agility and niche skills of fintechs building AI applications will do more to ensure they not only survive, but flourish, as the financial landscape continues to evolve.

Jesse Penner is VP Product at Grow Technologies


NCFA Jan 2018 resize - Using AI to Enrich the Customer Experience The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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