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AI Forum

How will AI impact customer experience in finance?

Artificial Intelligence (AI) is rapidly changing financial services and customer interactions with firms. This is being driven by competition for market share and the maturity of algorithms. Meanwhile, customer preferences are keeping pace with technological change too. Many customers now expect better, quicker service, at all times, from AI driven chatbots and robo advisors.

AI’s greatest advantage is communicating with customers faster and more accurately than humans! For customers, this means no more ‘hold’ music or waiting for a customer service agent to be available. Financial service businesses are regularly deploying new technology with many major banks globally now working with consumer facing chatbots. This is transforming the way banks engage with their customers and chatbots are becoming part of everyday life.

Last month, the AI Forum New Zealand and FinTechNZ met in Auckland, Wellington and Christchurch to discuss the impact of AI on the customer experience in the financial services industry. In Wellington, speakers included Xero’s Sam Daish, Microsoft’s National Technology Officer Russell Craig, data scientist Ernestynne Walsh and JNRY’s Michael Lovegrove.’s CEO Andy Dharmani, provided an overview of how everyday financial interactions can be automated using conversational digital assistants. This includes;

  • financial coaching to navigate transactions
  • booking a service and capturing accurate information
  • scheduling appointments
  • trading based on machine learning (ML) models
  • answering FAQs for products and services
  • automating claims processes
  • after hours support for repetitive queries
  • accepting payments over the phone
  • risk profiling using AI models

For example, ANZ’s digital assistant, Jamie, who answered 12,000 customer queries in its first 100 days. While most customer interactions are simple queries, AI can be valuable for scaling. Self-service AI is always available and can provide accurate replies and manage millions of conversations a day.

AI is primarily being used to deliver a more satisfying user experience. However, AI can also help maintain cybersecurity and improve fraud detection by analysing transaction patterns at scale. One of the primary opportunities of AI is the cumulative impact of automating many small, repetitive tasks, enabling humans to focus on higher value accounts.

Meanwhile, insurers and brokers are increasingly employing conversational AI (‘chatbots’) and automation as a more efficient form of interaction with customers. AI is reportedly the number one tech focus for InsurTechs. The financial and insurance services sector also shows the greatest economic potential from AI efficiencies, as reported by the AI Forum in Shaping a Future New Zealand.

In addition to improving customer experiences, AI can provide better insight to client behaviour.

While interacting with clients, every connection becomes a data point and aggregating this data provides further insights. These insights can lead to new algorithms that can make predictions to improve efficiency and reduce manual processes. The value of AI is its ability to learn without human intervention, so human resource can add value elsewhere. Chatbots are an early example of AI in action, but building relationship intelligence is the next step.

The key perceived challenge of AI in the financial sector is ethical concerns and fairness, especially removing decision making bias of automated systems and ensuring algorithmic transparency.

The Christchurch event panel debated that full transparency inside the ‘black box’ may be a step too far to achieve. However, if system data inputs and outputs can be clearly recorded (for example, in a credit scoring scenario), this provides a level of reassurance that algorithms can be understood and analysed for fairness.

Meanwhile, in Auckland, discussion included the substantial role of AI in financial services. While its key role is delivering better customer service and more personalised outcomes there is high value in removing repetitive tasks.

Financial choices have a long lasting impact on our quality of life and AI is a highly useful tool to help customers make informed decisions. It is transforming the customer journey and leading to a more satisfying experience.

Special thanks to Xero for hosting the Tech Alliance event series.

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