Artificial Intelligence has invaded almost all the industries and specifically retail banking in many ways. Banking Sector has long been a leader in AI implementation with significant spend on AI. The finance and the banking sector consider AI as a source of growth and development.
1. Product Cross-selling: AI aids in predictive recommendations based on the product offerings for existing customers on the basis of their demographics, financial standing and product history. Through predictive analytics, banks can anticipate upcoming events and work out a plan accordingly.
2. Personalized Experiences: Tailoring individual customer experience has become a must. AI can help retail banking in adjusting the digital experiences based on the products and services a customer has signed up for. Customers are looking beyond personalization to hyper-relevance, and AI is making that possible.
3. Risk Assessment: AI is a game changer for risk management in the retail sector as it provides solutions to identify potential risks and fraud. AI can help both the institution and the customers in this regard; retail banks can use Artificial Intelligence to determine where to open branches, what services to offer and whom to provide the loan. Meanwhile, customers can use it to take advice regarding investments or financial planning.
4. Effective Marketing: Multi-channel marketing strategies have helped the competitors to court the banking customers. Low-levels of customer-service interactions are enough to make the customer switch the brand. To maintain customer loyalty, AI is allowing retail banks to engage their customers through an effective marketing campaign and deliver personalized products and relevant information.
5. Contract Evaluation: Banks process thousands of loan contracts annually which is a time-consuming process, and can also involve a high margin of error. AI tools can automate this process by reviewing and analyzing legal documents which are cost effective and saves time as well.
6. Digital Dialogue: Chatbots could be one significant example of digital dialogue that is implemented extensively. Unlike human employees, Chatbots can assist users anytime and can help them in banking tasks like paying bills and checking account balances.
7. Cost Competitiveness: AI is cost effective as it can cut expenses related to personnel, process and procedures and decision-making. It also helps in real-time monitoring and tracking which further improves forecasting and fraud detection.
8. Cross-sector moves: It’s not only the AI-powered industry which should be laid focus upon. Major tech giants are leveraging a combination of large user bases, low acquisition costs, advanced analytics capabilities, and internet banking licenses to move into the financial industry.
Artificial Intelligence is referred to as a tool that is delivering tremendous change. It has already disrupted finance and is now revolutionizing the retail sector as well. As the tech giants are leveraging their databases, retail banks need to embrace AI to stay ahead in the market.