Use Cases and Benefits of Conversational AI in Banking and Finance

Most people today have access to services in ways that were unimaginable 20 years ago. Thanks to technological advancements, we can order food from our phones, buy whatever we need from a digital store, work from home, and much more. Comfort is everywhere, and the bar has risen when it comes to our relationship with banks. 

Users expect a more natural and intuitive interaction with their financial institutions. From managing their money directly from an app to using conversational AI technology to help solve problems. 

In this entry, we will discuss how conversational AI is changing banking and how institutions can better serve their customers. 

How Conversational AI is Transforming Banking - Use Cases

Banking institutions are using multiple technologies to improve their user experience and become more friendly partners for their customers. Conversational AI is one of the most innovative additions to their technological stack, helping organizations improve service capabilities by empowering users to solve problems.

Personalized Banking

Each person has their very own financial habits and patterns. With this in mind, financial institutions are heavily investing in building a personalized experience for their users to match their needs better. Conversational AI plays a role in this transformation by becoming one of the primary ways for customers to solve their issues, get things done without any need for assistance, and even become their personal banking assistant to help them meet their financial goals.

24/7 Customer Support and Assistance

Helping your customers anytime is a must for financial institutions today. With conversational AI solutions, you can support and assist your customers anytime and anywhere. Given the complexity of the technologies used for conversational AI, users can comfortably have a natural conversation with an automated virtual agent that can provide helpful answers or redirect them to the right person in an emergency. 

Assistance With Routine Banking Activities

A conversational AI solution can automatically perform daily activities such as transactions, payments, and applying for credit cards. This benefits customers by providing faster response times and efficiently performing what they need, and institutions by reducing the operational cost of serving customers with routine tasks. 

Application Processing, Assistance and Updates

Applying for financial products can take time. Using conversational AI solutions, customers can complete applications for multiple products independently, get assistance if needed, and, more importantly, get updates regarding their process. Unlike traditional banking, where physical locations are vital to access products, financial institutions can serve customers faster with conversational AI without any additional effort beyond integration. 

Product and Service Recommendations 

Given the capabilities of conversational AI banking, financial institutions can also provide more relatable product and service recommendations to their customers. Rather than having to read the small print throughout multiple documents, customers can interact with a conversational AI assistant that guides them through their options and recommendations in a personalized and thoughtful manner. 

Fraud Detection and Prevention 

Conversational AI technologies can help financial institutions prevent fraud by improving information management and security protocols. However, businesses should always consult their own legal counsel on all matters related to fraud detection and prevention to ensure compliance and customer safety. 

Assistance in Customer Onboarding

Customer onboarding can be tedious, given its repetitive nature. With conversational AI support, financial institutions can automate and accelerate onboarding by letting customers self-manage their onboarding process. This is also an opportunity to introduce conversational agents and get customers to discover they can interact with financial institutions in a more engaging manner. 

Documents Accessibility

Conversational AI plays a vital role in accessibility. With document readers or text-to-speech features, users with impairments, learning disabilities, or neurodivergence can access documents more intuitively. This helps users and financial institutions by allowing them to improve their customer experience across multiple demographics that would otherwise be more difficult to partner with. 

How is Conversational AI Beneficial for Banking?

The benefits of incorporating conversational AI products in the banking industry are tangible and financially beneficial for most organizations. Besides improving the overall relationship between customers and their bank, it can also improve efficiency and operations. 

Better Customer Experience

Financial institutions can improve their efficiency and service KPIs by providing a more empathetic customer experience with conversational AI support. Given the overall penetration of digital devices, allowing people to interact with their bank via conversational AI is a convenient and helpful way to elevate CX without operational overheads. 

Improved Operational Efficiency

Managing operations at any financial institution can be challenging given the complex procedures, security measurements, and people required to execute the work, among many other factors. Conversational AI can help reduce operational costs by assisting customers in solving multiple problems without human support. At the same time, AI can also help banks gather information more efficiently, improve their data analytics and customer understanding, and ensure human agents focus on high-value interactions exclusively. 

Valuable Data and Customer Insights

Besides becoming a vital CX tool, conversational AI can help organizations streamline data collection and analysis. Instead of relying on multiple teams and data points scattered across customer service touchpoints, with conversational AI, financial institutions can have a single data source that is categorized and organized to improve decision-making. 

Multichannel, Integrated Support

A common false perception of conversational AI is that it is only a voice channel. However, this is far from true. Conversational AI does have a voice support option, but it is also a text-based assistant that can be used across devices while updating information across touchpoints. In other words, users can start their interactions with their financial institution using a dedicated app, continue from their desktop, or directly with the voice assistant without explaining their issue every time. 

Reduced Issues Due to Human Errors

Financial institutions need human agents to handle complex transactions and situations. However, if the service required for many customers is repetitive, a conversational AI product can be more effective and less prone to errors. 

Accuracy and Consistency

Given the nature of conversational AI and the underlying technologies it combines, accuracy and consistency become second nature to financial institutions that include this solution to improve their CX. Instead of having to set up ways for multiple departments to interact with one another and provide service, conversational AI can streamline the process by redirecting only complex interactions to the best suitable agents. 

Challenges of Conversational AI in Banking

As with all technologies, implementing a conversational AI product in the banking sector presents challenges. While they can make the process complicated at the start, the end results and overall lift in efficiency and lean operations are quite evident, making it an intuitive product for most organizations. 

Privacy and Security

Privacy and security concerns are expected when implementing conversational AI technologies. Given the vast amount of information handled, selecting the correct type of provider that matches your business needs is essential. While not all providers have developed the same level of security and compliance, top providers focusing on enterprise companies like Mosaicx implement multiple security layers to ensure standards are met and customer information is safe. Banking institutions must be 100% confident that their conversational AI partner has the proper infrastructure to meet standards by doing a due diligence process. 

Integration Challenges

Integration is always challenging when implementing new technologies, especially in heavily regulated sectors like financial services. Once again, having a thorough due diligence process when selecting vendors is vital to ensure the conversational AI product you select integrates seamlessly with other internal technologies and departments. Not all providers have the same expertise, particularly at the enterprise level. For example, integration is generally not a challenge but a multi-step process with an enterprise-focused partner, ensuring technologies are set up well from the start. Smaller providers may promise implementation speed, but this promise usually applies to a handful of pre-approved software solutions and doesn’t include navigating complex businesses with multiple departments, technologies, and stakeholders. 

Customer Trust and Skepticism

While many customers may easily adapt to new technologies, some demographics may be skeptical about having a machine help them with their daily banking. This is why, in addition to integrating the technological aspect of conversational AI, it is often a good practice to create a number of tutorials and simple tasks for users to get started and develop trust in the new CX capabilities they can use. 

Regulatory Compliance

Compliance is another aspect financial institutions must pay attention to when implementing conversational AI solutions. Just like in any category, some providers have suitable mechanisms to ensure compliance (GDPR, CCPA, etc.) and secure information. However, others may not be as prepared to serve enterprise clients, potentially leading to sanctions and reputational damages. To prevent this potential problem, be sure to have a dedicated section of the provider selection process to double-check that regulatory compliance meets your standards. 

Ensuring Accuracy

Conversational AI leverages multiple technologies that can, on some occasions, rely on biased information. While this is becoming increasingly less common, it is crucial to consider the potential implications of biases and unpredictable patterns machines may find while learning to operate. Use a robust and diverse dataset during the machine learning stage of integrating conversational AI to prevent issues and have more accurate information and interactions with customers. Doing so allows organizations to tackle potential accuracy issues before they happen. 

Harness the Power of Conversational AI for Banking and Finance with Mosaicx

At Mosaicx, we use the highest standards of technology, compliance, and security to meet the needs of our enterprise customers. With multiple decades of experience, experts in every field required to deliver a robust conversational AI product, and dedicated service to ensure successful integrations and operations, we help businesses leverage new technologies with responsibility and efficiency. 

To learn more about Mosaicx, please visit our finance solution page.