Other parts of this series:
Interest in artificial intelligence technologies has been growing in the financial sector. But how can banks employ this latest member of the workforce most effectively?
In my last post, I introduced five key trends identified in our Technology Vision 2018 survey that have to potential to revolutionize both the retail and commercial banking sectors in Canada in the coming years.
In this post, I will take a look at the many ways that artificial intelligence (AI) is likely to have an impact.
AI is nothing new in banking
Financial services companies are veterans at using basic AI to replace and improve a finite set of repetitive, rule-based manual tasks, including anti-money laundering (AML) transaction monitoring and credit card fraud detection.
But today’s more cognitive AI—a system of advanced technologies that can sense, comprehend, act, and learn—now goes further, not only interacting more naturally with its environment, people and data, but also displaying humor, emotional sensitivity, and other human traits.
Leading banks around the world are already drawing on collaborative robots (cobots) that work near or alongside human workers to help them do their jobs better and give customers a better banking experience.
In our Technology Vision 2018 survey:
The respondents also believe that the majority of bank–customer interactions will be conducted via AI in the next few years, making machines the “face” of the organization.
In Canada specifically, interest and investment in AI have increased in the banking industry, due in part to several major technological breakthroughs here. For example:
- The Vector Institute, an independent, not-for-profit corporation launched in March 2017, aims to work with institutions, industry, start-ups, incubators and accelerators to advance AI and drive its application, adoption and commercialization across Canada.2
- Similarly, researchers from the Montreal Institute for Learning Algorithms (MILA), the machine learning laboratory at the University of Montreal, have pioneered deep learning and deep neural networks and their applications to vision, speech and language.3
Not only have Canadian banks like the Bank of Montreal (BMO) launched AI-based chatbots;4 the Royal Bank of Canada (RBC) is among the first banks in North America to incorporate AI into its capital markets research.5
What can banks expect from AI?
From our survey, it appears most banks seek three things from AI:1
- Customer trust and confidence (71 percent).
- Cost and operations optimization (63 percent).
- Compliance with regulations (62 percent).
Just like with any other employee, banks need to understand how AI might best fit into the workforce and the role it will play. The challenge is that, while there may be areas where machines displace humans completely (such as certain administrative roles), there are many more areas where the relationship will be symbiotic.
To get the maximum benefit from AI, banks need to break down traditional job descriptions into discrete tasks to understand where the technology can be most helpful. This should, of course, be done in an ongoing and continuous process to ensure and optimize the balance between humans and machines.
AI cannot be a black box
Importantly, as AI becomes a more visible co-worker that can make autonomous decisions, stakeholders are raising legitimate concerns about the processes by which an AI makes those decisions and whether the AI is making decisions within the right regulatory and ethical contexts.
Ultimately, as banks maximize the power of AI, banking regulations, such as the General Data Protection Regulation (GDPR) that is about to take effect in the European Union, are likely to raise the accountability bar on consumer data handling whether conducted by humans, machines or both.
As AI develops decision making capabilities, it needs to be subject to the same constraints and transparency rules as any other employee.
In my next post, I will focus on another key technology with exciting possibilities for future-ready banks: extended reality.
- “Building the Future-Ready Bank: Banking Technology Vision 2018,” Accenture, 2018. Access at: https://www.accenture.com/us-en/insights/banking/technology-vision-banking-2018?src=SOMS.
- “About Us,” The Vector Institute, 2018. Access at: https://vectorinstitute.ai/about/.
- “MILA Overview”, Montreal Institute for Learning Algorithms, 2018. Access at: https://mila.quebec/en/mila/.
- “BMO launches AI-powered chatbots on Facebook and Twitter,” The Globe and Mail, March 15, 2018. Access at: https://www.theglobeandmail.com/report-on-business/bmo-launches-ai-powered-chatbots-on-facebook-and-twitter/article38288966/.
- “RBC’s push into artificial intelligence reveals link between social media uproars and stock prices,” Financial Post, January 22, 2018. Access at: http://business.financialpost.com/news/fp-street/rbcs-push-into-ai-uncovers-chipotles-worst-queso-scenario.