Personalized Financial Experiences through AI

Overview

The financial services sector has always involved intensely personal operations. Consumers will switch their financial future only to individuals and organizations they can trust, a connection that has been built over many generations of interpersonal interactions.

However, devastating developments in business, technology, and society are now working together to sever ties between financial institutions (FIs) and their clients. Every banker's standard operating model is in danger due to new competitors, shifting consumer expectations, significant advancements in digital technologies, and increasingly complicated regulations. And that was prior to the onset of COVID-19, which is forcing consumers to radically reconsider their business practices and the people they choose to work with. The fact that they are increasingly conducting their banking online is one warning sign. Historically, banks have used branch visits to bolster their connections with current clients, draw in new ones, and launch new goods and services.

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What does the future AI-powered bank look like?

Strategic thinking—skills that were once thought to be uniquely human but are crucial for providing proactive, individualized services. These days, they enable Netflix and other businesses to provide recommendation engines that are based on user preferences and real-world behavior. Those victories required foresight, creativity, and strategic thinking—skills that were once thought to be uniquely human but are crucial for providing proactive, individualized services. These days, they enable Netflix and other businesses to provide recommendation engines that are based on user preferences and real-world behavior.

According to our prediction, banks will be able to surpass current service standards by 2025 in order to fully understand the aspirations and goals of their customer base and then take prompt, seamless action based on that information.

AI develops fresh strategies to win over customers' hearts and minds.

When opening accounts and obtaining loans, give FIs comprehensive financial and employment information. They make use of the institution's bill-paying services as well as its credit and debit cards. The positive reputation banks have in the financial industry gives them an additional edge over non-traditional rivals. In contrast to Google, Amazon, or Apple, banks have been around for more than 500 years, are subject to strict regulations, and follow a code of ethics when handling personal information. This is an ideal environment for developing trust. Even though users are worried about security, according to our survey, 65% of participants fully trust the way their primary banks handle their personal information.

More about data science applications in financial services can be found at Growwell.

Big data analytics, artificial intelligence, and less expensive.

What draws clients in and keeps them coming back?

We polled FI leaders as well as nearly 5,000 bank clients from all walks of life. The findings offer compelling evidence of what these clients want from their financial advisors. What they told us is highlighted in Don't fail, my data. All demographic groups contain both futurists and traditionalists, but there are some significant differences. Traditionalists are typically older and less tech-savvy. They might have less money or less valuable assets, depending on where they are in life. Additionally, they are hesitant to divulge personal information. They are easier to please, though, because they don't require as many extra services. Younger, more tech-savvy, and partial to digital goods and services are the characteristics of futurists. In a way, traditionalists and futurists are a positive cycle, and both merit consideration.

The potential for proactive, individualized services

Compared to traditionalists, futurists are far more likely to seek financial assistance. They desire that FIs utilize their personal information to proactively offer targeted guidance to assist them in reaching their financial objectives. Sixty-six percent of the respondents think that their primary bank should provide personalized proactive services, and fifty-seven percent would switch banks to obtain those services elsewhere. For instance, as we previously observed, these clients want specialized services like budgeting and lifestyle planning that take into account their requirements at specific phases of life and thoughtfully offer guidance on significant financial decisions. The following data from our consumer survey is even better news for financial institutions aiming to develop new business lines.

Future-focused individuals will rely on their primary FI to offer proactive, individualized services for a variety of products—if they establish a solid reputation as a service provider.

For finance and research insights, visit The Capital Box (TCB).

Conclusion

Bank customers' needs are rapidly evolving as a result of the pandemic forcing them to conduct more financial transactions online. They are examining service providers in other sectors and enjoying the speedy delivery and nearly seamless online shopping experience. They are examining Venmo and how it enables them to electronically send money to friends without having a bank connection, as well as Netflix and how it offers timely viewing recommendations based on their previous selections.

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