Financial services embraces AI | TECH(talk)

hi and welcome back to Tech Talk I’m Ken
Mingis executive editor at computer world I’m here with computer worlds
Lucas Mearian today’s topic financial services and AI I’m gonna find out
what’s going on from Lucas stick around okay so Lucas thanks for being here I
know you’ve just started digging into this this topic for a story that you’re
working on but I guess you’re finding out that AI is is moving into is moving
away from pilot projects into real world projects in some financial services and
I just wanted to find out well what do you know
not much noel tantrum actually what I learned was the banking industry is is
really high on AI right now they’re spending billions of dollars on this
there are a second actually only to the retail marketplace and but part of the
problem is that a lot of the spending is being done without a real business use
case it’s it’s the trendy the hot technology there are use cases out there
but in many cases being deployed for the wrong reasons that’s number one okay
number two there are mainly pilots out there right now even the large banks are
mainly focused on pilots but that is expected to shift beginning this year
and moving out into the next 2 3 4 years we should be seeing more production
systems going into going live so mainly what is the technology about the vast
majority of it is being used to create more efficiency in the customer
relationship process with a bank so if somebody comes to a banking website or
is doing some online banking whatever the the AI or the machine learning
whatever the the system that they’re they’re rolling out is designed to
basically cater to those customers more efficiently I guess yeah effectively
yeah so you can either be directed to buy a
chatbot to instead of using phone using the website which can be more efficient
you can get simple or mundane questions answered by a lot of these chat bots so
chat back technology is probably at the top of the list but then you have other
technology that’s helping to tie together these disparate systems within
banks these two spirit CRM system the cross lines of business so right now
their component alized they don’t talk to each other so you don’t really get a
full picture of the customers history with that bait for example a customer
may have checking account savings account credit cards that are tied
together but then they want to take out a mortgage and that’s a completely
different business unit and that information isn’t tied to their savings
their checking or their credit card accounts so they want to get a more
complete picture so that they can not only be more efficient in servicing the
customer they can anticipate that customers eat well I mean it sounds like
it’s a perfect example of trying to break down the silos within the
financial services businesses or industries or banks and then figuring
out what the customer is doing based on what they’ve done in the past and then
upselling them exactly either a new credit card or a new credit limit or as
you say a mortgage or a car loan or something like that and using it’s using
what the customer has already done in the past it’s interesting that it that
it’s it doesn’t seem like banks have already been on that I’m surprised that
they haven’t figured out a way to sort of track that stuff and and make it work
for them already well to a low level kind of a I don’t want to say dumb but
but not a highly intelligent system it has been in place for quite some time so
you might get pitched a credit card with a higher credit limit just based on your
recent credit card history with the company that’s pretty simple stuff but
the credit cards could offer certain benefits you know mileage for example uh
points bad points back and but they they need to know your history in order to
know what to pitch you versus just blindly giving you something based on
your credit report okay and so what what banks and financial institutions have
been doing is basically doing all these little test projects over the last few
years which they’re still doing but the implication there is that they’ve now
gotten enough data from customers and how this system would work that they
feel prepared to begin rolling this out in real world yeah yeah they’re calling
big data down to the point where they can start offering more customized
products and in many cases that’s and of course that’s not the only area it’s
being used and you also have a lot of regulatory requirement
out there that financial institutions are required to comply with such as know
your customer and anti-money laundering rules and in order to do that today it
can take as long as six weeks to know determine a customer’s true identity
really yes we can take six weeks well we’re not just talking about one human
being we oftentimes it’s a Conklin corporation a corporation they were
doing business with and yeah it can take that long because you’re not only
searching internal records for the company you’re searching external
information about that company or in some cases a person machine learning and
AI technology can actually reduce that to a number of days giving a feedback to
the compliance officer who then can look at that information it just reduces the
labor load on what was before of a pretty manual tasks okay so I can see is
there do we have any sense yet whether these whether the AR or the machine
learning that’s going to be used at say Bank a would be able to talk to or
interact with the same system at Bank B or Linder see is there any way to sort
of or is this all gonna be within each company within each Bank within each
credit card company yeah as far as I can’t unfortunately don’t know that’s
okay I can’t speak to that because I don’t know if there are interoperability
standards being established out there I did I know of there aren’t there there
could be you know but I’ve not been told that there are ok good interesting to
find out what else do we know if any so also so now mostly we’ve been talking
about customer-facing applications for AI and machine learning well within a
company you can also use AI and machine learning to call data to produce reports
to to produce information that helps the bank itself become more efficient so
across it between the various business lines so that sort of edges into sort of
like data analytics beta and what what customers and companies are doing with
the financial institution exactly within the company itself so that today that’s
of course done through mostly through human effort which is arduous takes a
lot of time this this way you send out a script that looks across for similar
data across systems and complain you can compile reports based on that okay time
frame on this next year or two that people will start you know customers
will start seeing these kinds of chat BOTS and interactions and upsells and
everything else I had two different experts one from Deloitte and another
one from a AI services company the AI services company believed that it was
going to be within the next year that you’re gonna see more production systems
in fact probably this year they’re gonna start 2019 right Boyd thought that was a
little more a little too aggressive probably over the next one to three
years okay which is gonna start so sometime between this year and 2022 yeah
this will be rolled out probably across most of the India to see more production
systems yeah definitely okay last thoughts for let you go um let’s see
customer relationship management got into regulatory compliance oh not
natural language processing so that was was one other area I want to just touch
on quickly so these this this AI technology is able to process your your
voice on a system determine so if you’re like on the on a mobile phone and right
okay we’ve all had experiences with that I mean you call them good not so good it
should improve over the next year or so because these are getting better the
other thing it can do is natural language generation so it can generate
natural language and write in plain language for customers to understand I
do have to wonder if at some point this is all gonna get tied in with like Alexa
or Siri Siri raise my spending limit how could it you know or well I mean if you
think about it if you could tie it in with Alexa then you could buy things and
and boost your spending limits and put it on your credit card all with the
sound of voice from home right to go wrong okay Lucas thanks for the for the
update obviously more to come on yeah we’ll we’ll check back with you later in
the year and see if these things are actually rolling out for AI financial
services Lucas and me that’s wrap

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