Gen AI Turns Bank Chatbots Into Financial Advisors

The banking industry is undergoing a transformative shift fueled by advanced artificial intelligence technology, transforming financial chatbots into adept problem-solvers along the way.

According to insights from PYMNTS Intelligence’s “August Embedded Finance Tracker® Series Report,” the integration of AI has led to a 65% increase in response efficiency, heralding a future of enhanced consumer banking experiences. The integration of AI is shaping a future where digital assistants go beyond listening to understanding and anticipating consumers’ needs.

For example, J.P. Morgan Chase is using real-time data to create intuitive, human-like interactions through generative AI-powered chatbots, while Israel’s One Zero Bank has teamed up with AI21 Labs to harness data-rich back ends and transform previously cumbersome chatbots into engaging and effective strategic assets, per the study.

Nordic bank DNB has also been providing its employees with conversational AI-driven virtual assistants over the past three years. One of these, a virtual agent called Juno, assisted the bank’s customer service departments in handling over 2 million inquiries in 2022, an average of about 1,200 users daily.

Dutch neobank Bunq is the latest financial institution to embrace this trend, launching this month a generative AI-driven platform, Finn, to assist its users across Europe in managing budgets, organizing finances and streamlining transaction searches, among other functionalities.

Operating via a chat-style interface akin to OpenAI’s ChatGPT, Finn offers assistance on various financial queries, using data to provide nuanced responses beyond simple transactions.

“[The platform] has a chat-style text box where users can ask questions or seek advice about their bank account, spending habits, saving and anything else related to money,” Bunq noted in a Monday (Dec. 19) press release, emphasizing Finn’s ability to address complex queries such as the average amount a user spent on groceries each month or how much they spent on Amazon this year.

While these innovations will continue to shape the future of consumer banking, maintaining compliance with regulations and keeping fraudsters at bay remains critical. As noted in the report, banks need to invest in AI solutions that not only detect but also prevent fraud, preserving consumer trust amidst innovation.

AI technology is driving a paradigm shift in banking. Financial chatbots, powered by AI, are becoming adept problem solvers, paving the way for digital assistants that anticipate and understand consumer needs.

Meanwhile, FIs are embracing AI to enhance customer experiences, but they must navigate the balance between innovation and compliance to maintain consumer trust and confidence. And as the future demands AI-driven interfaces, the potential of AI in consumer banking signals a fundamental shift that will define the industry’s future.

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