Banking Sector: Changes By Artificial Intelligence
Well, a look at the title and you can automatically visualize about chatbots and identity theft. But AI in banking sector comes more than these two platforms. In this article on banking sector: changes by artificial intelligence, we will focus on recent technology changes. There are some who think that artificial intelligence is a separate entity.
But in reality, artificial intelligence is a combination of three technologies, namely, natural language processing, machine learning, and cognitive computing.
So, what is Artificial Intelligence?
It is imparting human intelligence into machines, with the assistance of machine learning and processing algorithms to accomplish complicated tasks. So what do you think is the main motive for the data to get transferred to machines? Is it that the human brain cannot fix solutions to complicated problems?
No, the answer lies the other way.
A human brain and body can work only to a certain extent. Even the speed matters. But artificial intelligence tools, designed with supreme algorithms can have the capabilities to process thousands of accounts in a minute.
Other Industry Sectors
Artificial Intelligence has already made a mark in many sectors. Even the healthcare industry has wholeheartedly embraced artificial intelligence to gain accurate results with regards to medical reports. This technology is growing by leaps and bounds. Yes, the Artificial industry has also stepped into the banking sector.
But the changes are still in the nascent stages. But yes, research is going on to explore and implement the vast array of possibilities of artificial intelligence in the banking sector.
So, what are the few applications you can think of about Artificial Intelligence in the banking sector at the first instant?
It is really easy to visualize. You can think of chatbots in bank customer service, withdrawal of money in ATMs, and even humanoid robots for customer interaction.
And yes, you feel that the Artificial Intelligence tool can minimize the possibilities of fraud and security risks when it comes to digital transactions and payments.
Research spent on Artificial Intelligence Applications by banks
As per a report, banks spent 4 billion dollars on AI research applications in 2015. As of 2017, the cost has expanded to 5.1 billion. And yes, the Indian banking sector has also invested a sizable amount of money in AI research and applications.
So, what do the bank employees think about Artificial Intelligence?
In the recent report, many of the banking staff believe that they will work in close coordination with AI tools in 2020. And they feel AI will make an impact in automation and decision making.
But many agree to a common factor. AI applications will assume more responsibility than humans. And they also point to a challenge. The AI application has to get fed with proper data. Or the result will be false reports.
How Do The Banks Plan to Implement AI in the banking system?
Well, by tapping right into human traits. It is the era of Indian Idols, and everyone wants personal attention. The banks are playing cards taking into account this specific character trait of humans.
Shall we take a case study? You withdrew money from Citibank ATM an amount of Rs 3000. After you took the money, you get a message, is Rs 3000 your favorite amount?
Now, this is nothing but an AI tool who is designed to take into account your preferences. And the next time, you want to withdraw money, you get another message at the machine? Do you want Rs 3000? It means that your data has been captured, and the AI tool is storing your preferences.
1. Customer Support
Banks are not depending only on AI research organizations and companies. They are encouraging the public to build solutions for the implementation of future technology such as AI or Blockchain in the banking industry.
For example, State Bank of India had conducted a competition called as “Code for Bank” to encourage developers to build innovative technology for the industry.
So, will the foreign banks be far behind?
HDFC Bank, ICICI bank have also introduced the chatbot option in their customer service. As per the recent reports, Canara Bank has introduced two robots by name, Candi and Mitra in some of its offices.
2. Identity Theft and Fraud
So, we come to the most important part of the banking sector. Payments and transactions. Now, let us focus on why you keep money in banks. For safety?
Right, and if your amount gets stolen? Then all hell breaks loose. In this era of digital payments, identity theft and phishing activities are common. The hackers even make use of fake debit and credit cards to withdraw money.
So, in case a hacker makes a fake debit card, and withdraws money, the AI tool detects the changes in patterns and sends an alert immediately to your mobile and the customer care executive. If you take prompt action immediately, then you can stop the theft.
3. AI Tools in Spending and Payment
Let us imagine, from the sort of online purchases. You are an aggressive Amazon shopper and always buy products from different bank accounts. Now, the AI tool in the website, will store your data, analyze the payment patterns, and recommend the bank account you used the most.
In the future, bank ATMs may have face recognition algorithms to prevent frauds and other crimes.
Have you read the article? Now let us take another case study. You are an entrepreneur home care services in Hyderabad. You provide experienced handyman professionals to various types of home repairs such as refrigerator repair, microwave oven repair, geyser repair in Hyderabad, and many more.
Now, you make most of the payments to your employees using digital option. In an unfortunate situation, your debit card gets stolen and the concerned thief has cracked your PIN. Now, he withdraws money from your account using fake identification.
If the bank has implemented AI, the tool detects the sudden activity of withdrawal of a huge amount of money and sends an alert to you and the bank management. The executive makes a call, and that is when you inform him of the theft. The AI tool on the meanwhile has put a hold on withdrawals.
So, some portion of your money gets saved, and the next important factor, the AI tool also notes the personal details of the hacker. It is only a matter of time when you with the help of law enforcement agencies recover the other part of your money.