Even before the onset of the recent pandemic, the transition to Digital Banking was well underway and documented. For financial institutions, having effective web and mobile banking platforms were no longer a “nice to have,” but a necessity. The recent environment has only further heightened the importance of managing finances thanks to the volatility of the economy and workforce. As a result, Digital Banking capabilities have never been more important.
With virtually every financial institution (FI) offering some form of digital banking experience, the question then becomes how do they differentiate themselves while addressing the ever changing needs of their customers. Leveraging the power of AI, in the form of human-like Conversational Banking experiences made possible via a Virtual Financial Assistant (VFA), is allowing FIs and their customers to engage in ways never before possible and enhancing the overall digital banking experience. FIs who have successfully adopted the technology are now enjoying benefits in three key areas: customer and member adoption, ROI and constantly improving technology.
AI Increasingly Becoming Part of Everyday Life for Consumers
Adoption of Conversational AI by consumers has taken off. Whether via their favorite app, web site, smart speaker or other digital platform, consumers are increasingly becoming accustomed to interacting with virtual assistants and other forms of AI.
CX and Technology heads at FIs can look to Bank of America’s Virtual Assistant, Erica, as a prime example for the financial services industry – it has surpassed 12.5 million users. Our own data shows that ten to twenty percent of Digital Banking users engage with our VFA when available, with strongest adoption coming in Online and Mobile Banking. As an example, we recently installed a VFA for a client within Mobile and Online banking. It enjoyed 14% adoption within 90 days (with that number continuing to grow five to ten percent month-over-month), helping 4,300 users through 9,400 conversations. Our key recommendation – find the channel or channels that resonate with your customers most (we can help with this) and commit to engaging with them there…because they are already there.
Creating Efficiencies Without Sacrificing Options
An obvious starting point for the power of AI for FIs is an observable improvement on the income statement. We see cost savings across a few key areas including, you guessed it, decreases in inbound contact center phone calls and live chats. In the previously mentioned client example, these use cases prevented 7,400 call-center interactions and at savings of $2.75 per interaction, decreased costs by more than $20,000. While some conversations are still escalating to a live agent, we see that number continuing to decrease as the VFA continues to learn. In the same client example, the VFA began with 62% of requests requiring human interaction. In a period of ten weeks, the average decreased to 34%.
From a human perspective, this means that customers and members are being given options including still connecting person-to-person if that is their preference. Bottom line – a FI can improve cost/operational efficiency while better engaging customers.
The Technology is Ready and Only Getting Smarter
Over the past ten years, the advances in Natural Language Understanding, Natural Language Processing and Machine Learning have driven AI to a point of commercial readiness for widespread adoption. Let’s take a look at our own Intent Library, for example. The catalogue of intents that our VFA can understand and respond to, has grown immensely. What’s more critical than growth in the number of understood and respond-able intents is integration in those areas that yield value for banks and credit unions. Most often, this is at the digital banking layer, which makes transfers, balance checks, PFM and wellness journeys achievable. The future will also yield a larger library (i.e. use cases) providing higher accuracy and conversational data, steering where human involved builds and infrastructure updates need to happen.
Conversational Banking Powers Long-Term Relationships
The ways that consumers manage their money and engage with FIs have obviously changed. AI, in the form of Conversational Banking, is proving to have the ability to positively address these needs while allowing the type of engagement with customers that leads to greater brand loyalty. How do you ask? It goes beyond the typical transactional activities such as checking balances, reviewing recent spending and paying bills. While an important part of the Digital Banking and Conversational Banking paradigm, these actions don’t differentiate one institution from another.
Leveraging the power of AI to allow consumers to obtain valuable insights, receive proactive notifications/alerts and set financial goals through natural conversations in the channels they prefer is where it’s at. When done correctly, Conversational Banking is convenient and can serve as a valuable tool to help people manage their finances when they want, how they want and where they want. This partnership and focus on financial wellness builds the type of trust that leads to long-term relationships between FIs and their customers – proof that there has never been a better time to integrate Conversational AI into the Digital Banking mix.
If you are with a bank or credit union that is interested in leveraging the power of a VFA to better engage customers, give us a shout and we’ll be happy to tell you more.