Chatbots are computer programs based on artificial intelligence that provide responses or solutions to questions or requests posed by clients. The finance industry uses this technology to reduce the reliance on staffing live chat services, phone banks, or social media monitoring because it automates needs based on recognized inputs to optimize and streamline available services.
According to Accenture, over 70% of customers in the finance industry are open to the idea of interacting with a well-programmed chatbot. The attitude toward this technology is a reflection of the desire to have institutions in this sector feature mobile-first and digital features. Even after an annual investment of $20 billion on transformation activities annually since 2017, the biggest banks are at a high risk of losing up to $350 billion in deposits because of client frustrations with account access.
According to Deltec Bank, Bahamas – “The members of the finance industry who recognize how chatbots can provide essential services first are the ones that can secure more engaged clients. That’s because their transformation efforts can evolve to meet the changing needs of the customer base.”
Improvements that Chatbots Bring to the Finance Industry
Chatbots can encourage customers to become new clients by providing critical information and follow-up explanations when necessary without manual intervention. This benefit enables an improved prospect conversion rate while putting human resources into more substantial areas of capital generation. Customers benefit because the interaction with this system is predictable – a trait that is not always available when dealing with a person.
Several additional improvements are possible for institutions in the finance industry when embracing the idea of using chatbots for frontline customer service needs. Analyzing these possibilities through the lens of digital transformation can help firms discover new and potentially profitable ways to engage their client base.
1. Chatbots can streamline sales and lead generation.
Banks need to pursue prospects like any other business. If they don’t sell lending products or banking services, then it becomes challenging to sustain a business profile. Chatbots can get programmed with a list of questions that target specific client needs or common requests by visitors, using AI to recognize particular terms so that an appropriate response is given in return. This technology enables an institution to identify potential customers quickly, focus on warm leads, and deliver high-quality results.
2. This technology can cross-sell products for banks.
“Chatbots can recognize customer behavior patterns on a website, while analyzing an account, or understanding important movements and life events says Deltec Bank-Bahamas. Offering personalized industry products at the precise time consumers need assistance can lead to improved cross-selling and expanded revenues for the bank. Individuals and businesses get the capital they need for whatever situation they face – making it a win/win scenario for everyone involved.
3. Chatbots encourage customers to use automated banking services.
Natural language processing and machine learning enable chatbots to develop an understanding of individual client needs. This technology serves a bank all day and night so that services are always available to customers, creating highly responsive interactions that have more accessibility than human agents whenever consumers feel that a resolution is necessary. It takes 11 hours for a typical query to reach a decision when using the traditional processes of manual intervention, but chatbots can complete the work in only 24 minutes – with 49% of the issues resolved in the first interaction.
4. It can offer money management solutions for some customers.
Chatbots can help customers execute financial decisions at any time when clients authorize the technology to do this work. Banks can connect it to a massive network of global information that includes data on financial liquidity levels, market status, and consumer sentiment. Then the chatbot can browse through individual accounts, identify potential choices that can grow wealth, and then offer investment advice. Although simple questionnaire programs are what most people see online today, this tech will evolve into a sophisticated conversational algorithm that can become a personalized financial assistant that manages bills, balances, and investing activities.
5. Chatbots enable banking on social platforms.
Banks are looking for ways to engage with customers outside of the online accounts and in-person branch encounters to provide more critical services. Social platforms are tapping into this desire by using chatbots that connect people to their preferred brands, making it easier to maintain healthy B2C relationships. Even when clients recognize that a chatbot is communicating with them instead of a real person, the investment it takes to develop this resource still feels like a connection. That means being active socially can build higher levels of trust.
6. This technology can manage customer feedback.
Banks need client feedback to understand the unique strengths and weaknesses of each brand and location. Chatbots can present questionnaires and surveys to customers in non-threatening ways to let people share their experiences anonymously. Most people don’t leave poor reviews when an undesirable interaction occurs – they take their money to a different institution instead. Offering this service can help more feedback data to come in so that services can continuously improve.
7. Chatbots can offer location services for banking needs.
A chatbot can use authorized location-based services to direct consumers to the closest place to resolve specific needs if online resources are unable to do so. This service can help clients who want to find their nearest branch, a network-enabled ATM, or access to advanced lending products, such as mortgage generation. Creating an ecosystem like this ensures that individual institutions can scale appropriately without compromising the levels of service given to each customer. This approach enables customization without having human capital involved to analyze different needs.
Banking customers usually check the mobile capabilities of an institution before selecting one to manage their accounts. Chatbots are an essential piece of that puzzle because this technology can continue to learn about each client’s assets, capabilities, and finances to offer recommendations while being available to solve problems when they arise. The learning algorithms work with constant availability so that a majority of issues can get resolved without human intervention.
Disclaimer: The author of this text, Robin Trehan, has an Undergraduate degree in economics, Masters in international business and finance and MBA in electronic business. Trehan is Senior VP at Deltec International www.deltecbank.com. The views, thoughts, and opinions expressed in this text are solely the views of the author, and not necessarily reflecting the views of Deltec International Group, its subsidiaries and/or employees.
About Deltec Bank
Headquartered in The Bahamas, Deltec is an independent financial services group that delivers bespoke solutions to meet clients’ unique needs. The Deltec group of companies includes Deltec Bank & Trust Limited, Deltec Fund Services Limited, and Deltec Investment Advisers Limited, Deltec Securities Ltd. and Long Cay Captive Management.