Conversational AI in Banking and Insurance

Why are Financial Services Providers Banking on Conversational Chatbots to Improve CX?

“Chatbots are ruling the finance industry. However, with changes in technology, it is succumbing to a greater force—Conversational AI. Conversational AI works like humans and enables intelligent conversational capabilities and experiences for an enterprise.”  

The BFSI industry had a penchant for chatbots. Even though it was out of angsty or excitement caused by the digital age, the fascination with the technology proved to be thrilling, though for a short span of time. With the rise of conversational AI (Artificial Intelligence), the euphoria seems to be ending for the one time hit tech-trend, chatbots. 

Financial services providers worldwide could possibly adopt, or rather say, have already started to adopt conversational AI.

But, is the ruckus over conversational AI in finance worth it? 

The conversational AI market share, which was worth $3.2 billion in 2018 and $4.2 billion in 2019, is expected to reach $15 billion by the end of 2024. The technology is shaping connectivity, engagement, and communication experiences in the finance industry. A throng of financial services providers are rising in anticipation and yearning to deliver AI-powered customer support services to gain customers’ trust that can help build a healthy relationship. So, now the question is: 

Why Do Financial Services Providers Need AI-powered Conversational Solutions?

Conversational AI bots are great at engaging customers and delivering omnichannel experiences, which in turn essentially helps in converting conversations into opportunities. The bots not only meet customer expectations but also exceed them. They can help financial institutions get rid of manual CRM (Customer Relationship Management) processes and reap the benefits of automation and reasoning.

Pretty cool, right?  :

But, what led to the failure of traditional chatbots and how promising are conversational AI solutions for financial services providers? 

According to a recent survey conducted by Forrester, “Customers don’t think bank experiences are improving.” Chatbots may have helped many in the BFSI industry start afresh, but as of 2019, it has failed. Customers are of the view that they haven’t come across any of the chatbots that could even meet their expectations. Therefore, the survey result is worth considering and mulling over, for CX seems to be playing a key role in driving business growth in the contemporary market scenario.

Conversational AI in finance enables businesses to deliver humanized experiences to customers. In other words, AI-enabled conversational solutions give freedom from traditional chatbots that are famous for not delivering desired answers in correspondence to customer queries. 

The following are some of the ways that will help you deduce how advanced conversational chatbots, powered by AI, help financial services providers earn customers’ loyalty and deliver superior experiences. 

  • Insight-Driven Financial Institution 
    AI-based conversational solutions make effective use of analytics, which essentially helps in gleaning data, generating from both within and outside the organization. Be it, customers, employees, or competitors, conversational AI platforms are considerably efficient at monitoring and managing large volumes of data and putting them in the right structure. Conversational AI in finance works as one of the most efficient tools to perform comparative data analysis in real-time, which helps in effective decision-making. Using this technology, financial institutions can know which the business generating areas are, which regions demand investment, who are the competitors, and whether or not the business is able to create new experiences for customers as well as employees. Powered by analytics, advanced conversational chatbots help build insight-driven financial institutions, where all sorts of risks are easily mitigated. 
     
  • Self-Evolving Platforms 
    Unlike traditional chatbots, AI-powered conversational chatbots are not script-based or answer questions in accordance with pre-defined parameters. With advanced technologies such as NLP (Natural Language Processing), ML (Machine Learning), IoT (Internet of Things), and more, the conversational AI platforms understand the real intent of customers. They learn from previous responses, existing databases, and ongoing customer interactions to prepare responses that are in line with the customer queries.
     
  • Customer Engagement 
    When a conversation goes right, customer engagement and experience improves. With traditional chatbots, financial services providers did see an increase in customer engagement, leads, and conversions, but they lacked the art of natural conversation. Therefore, chatbots left the customers jaded, which ultimately led to substandard business-customer relationship. On the contrary, conversational AI solutions offer humanized conversations, without having a human agent guiding them. It uses AI-enabled tools to offer efficient text-to-voice and voice-to-text conversions, which enable the natural flow of conversations and bridge the machine-to-human communication gap. In short, deploying conversational AI solutions means offering intricate experience delicacies that certainly fulfill tech-savvy customer’s appetites.  
     
  • Work Efficiency and Cost Savings
    Reports suggest that by 2023, conversational AI will help banks save $7.3 billion and approximately half a million (862 million hours) working years. There is still time to analyze whether this prediction is right or wrong, but for the time being, there are strong reasons to live in anticipation that AI-powered conversational chatbots are here to stay. Conversational AI can help financial services providers collect valuable customer information, offer information that customers seek, and redirect the case to a CRM representative if required. This improves work efficiency and allows employees to focus on other core areas.          
          
  • Operations Beyond Borders 
    It would be correct to say that Conversational AI is a true facilitator of conversational banking and machine-to-human communication. Financial institutions can use this technology to attract ‘next-billion users,’ who want to interact in their local dialects. Even more, the institutions can expand their business outreach to the non-banked population of the world, who lives in rural areas and are not formally educated. AI-powered conversational solutions offer vernacular language solutions that help financial services providers go beyond the borders and be truly global.  

AI-based Conversational Solutions Reciprocate Well to Customers’ Queries 

Since the advent of Eliza, factually the first chatbot that initially passed the Turing test, conversational solutions have undergone innumerable experiments and innovations. And as the year 2020 approaches, here we stand, talking to smart devices such as Google Home and Alexa, which are AI-powered conversational chatbots and thrive on humans to effectively reciprocate with their virtual actions. 

Amidst an enthralling ride between attraction and antagonism for technologies, many of the financial services providers are trying their hands out at mobility, IoT, and more to keep up with the digital pace and tech-savvy customers. As technologies evolve, trends change and customer expectations go a notch up. In such a scenario, conversational solutions, laced with AI capabilities, prove to be a perfect solution for modern-day customers, who seem to have eventually grown a habit of interacting with machines anywhere, anytime.