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May 26, 2022updated 16 Jun 2022 9:11am

Chatbots to make online banking efficient and more personalised

Harry Swain, retail banking analyst, GlobalData discusses the success banks such as NatWest and Bank of America are enjoying with their chatbot offerings

As banks look to become more time- and cost-efficient through digital advancements, chatbot usage on online platforms is becoming increasingly popular due to the more personalised banking experiences they offer.

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How is AI impacting the future of Banking?

In banking, artificial intelligence (AI) use cases range from enhancing client interactions through chatbots; to providing better loan terms through data-driven risk assessments; and the automation of laborious back-end processes. Banks can realize the benefits of AI in cost savings, quality improvements, expansion of services, and increased personalization in these product offerings. GlobalData’s AI in Banking Thematic Research report provides you with an in-depth lens into the impact of artificial intelligence on the industry. We highlight both the challenges and opportunities associated with the innovative technology now, and in the future. Our report also covers:
  • Major players and companies
  • Market size and growth forecasts
  • Case studies
  • Sector scorecard
There has never been a more important time for banks to invest in AI. With threats to the industry coming from both disruptive fintechs and the COVID-19 pandemic, you should be proactive in adopting strategies and processes to help you remain competitive and desirable to consumers. Download the full report to get ahead of the competition.
by GlobalData
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Chatbots are AI-constructed services added to aid customers with any queries they have and make the online banking experience faster and more personalised. Chatbots allow customers to ask any question they may have and receive an answer quickly through an automated service that does not require any waiting for a human agent, as well as informing them of any irregular spending habits or updates regarding their accounts. There are also benefits for the bank with chatbots, with a study by Juniper highlighting that chatbots can save them $7.3bn by 2023 and save four minutes per enquiry.

Bank of America score chatbot hit with Erica

The Bank of America’s (BofA) chatbot, Erica, is a key example of a chatbot whose customer uptake has grown significantly since the introduction of chatbots in banking. During the pandemic, BofA updated Erica with more than 60,000 phrases and answers to an array of queries, allowing Erica to aid customers efficiently while in-person communications were reduced.

Erica holds a 90% efficiency rating from its 19.5 million users throughout the US. Erica is not just a Q&A system that many consider chatbots to be. On the Banking Transformed podcast, BofA president of retail banking Holly O’Neill explains that the focus of the Erica chatbot is to personalise each BofA customer’s experience. Alongside providing tools and solutions to customers, Erica can financially educate and push better money habits to customers, providing individuals with the relevant information for them. The chatbot acts as a personal assistant, providing prompts when recognising irregular spending habits and detecting vulnerable customers to encourage better money management.

Cora: NatWest’s chatbot success story

NatWest has also been developing its own chatbot, Cora, which differs from the usual type of chatbot in that it has a digital person communicating through voice. In the Q1 2021 earnings call from NatWest, CEO Alison Rose states that Cora’s usage “has grown 58% year on year, with over 40% of interactions completed without human intervention.” This further highlights the number of customers willing to use chatbots when banking online.

There have been some issues arising in chatbots’ initial stages. Customers reported that they would sometimes provide information not related to the request and could end up in a never-ending circle of conversation, with no ability for human intervention. Forbes found that 86% of users prefer human interaction, as they feel a lack of personal touch, with PSFK finding that 74% of users will only use chatbots for simple tasks. However, Userlike’s survey highlights 68% of users see the speediness of solution as chatbots’ biggest upside, with only 9% of respondents saying companies should not use them.

The future of digital banking will almost certainly contain chatbots, and banks will need to find how to perfect their usage. With customer satisfaction being a key to growth, banks will continue to develop their AI assistants in the future, continuing to make online experiences more personal.

Free Report
img

How is AI impacting the future of Banking?

In banking, artificial intelligence (AI) use cases range from enhancing client interactions through chatbots; to providing better loan terms through data-driven risk assessments; and the automation of laborious back-end processes. Banks can realize the benefits of AI in cost savings, quality improvements, expansion of services, and increased personalization in these product offerings. GlobalData’s AI in Banking Thematic Research report provides you with an in-depth lens into the impact of artificial intelligence on the industry. We highlight both the challenges and opportunities associated with the innovative technology now, and in the future. Our report also covers:
  • Major players and companies
  • Market size and growth forecasts
  • Case studies
  • Sector scorecard
There has never been a more important time for banks to invest in AI. With threats to the industry coming from both disruptive fintechs and the COVID-19 pandemic, you should be proactive in adopting strategies and processes to help you remain competitive and desirable to consumers. Download the full report to get ahead of the competition.
by GlobalData
Enter your details here to receive your free Report.

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