Chatbot Trends in Banks and Financial Institutions

Banks and financial institutions are among the top 3 industries in using chatbots. It is expected that the percentage of usage will increase in the next few years, especially for chatbots with artificial intelligence. Digital banking services are preferred by most bank customers and their usage rose during and after the pandemic. Self-service technologies in this industry grew up also and AI chatbots are part of this trend. The need for contactless services and online communication led to an increase in the interest in chatbots, especially with artificial intelligence. According to Cornerstone Advisors as of early 2020, 13% of banks and credit institutions had a chatbot, and another 16% were planning to introduce one in 2021. Being already in the fourth quarter of 2022, these percentages continue to increase according to the eMarketer forecast for bank chatbot users in the USA in the period 2021-2025. And by 2030, chatbots will be so ingrained into the banking process that customers won’t be able to tell if they are interacting with the bot or a human, according to EY.

Chatbots benefits for banks and financial institutions

Chatbots can help banks and financial institutions with simple tasks, customer service and support, automation of FAQs, checking financial status, and others.

AI chatbots help customer service and support teams with automation of the frequently asked questions that every employee would happily leave to a chatbot to deal with. This relieves the work of the support agents from routine questions and inquiries and lets them have more time for more complex and valuable tasks. Customers will receive answers to their questions immediately thanks to the AI chatbot and won’t wait for hours to receive a phone call back from a support agent or wait in queues in the banks to ask a simple question.

AI chatbots also can collect customer data that can be gathered in statistics for further analysis of customers’ problems and needs. They can collect insights on customer behavior, what services they have searched for more, what are their main needs and that can help to predict trends of what are the customers’ future plans with their finances. These insights can help banks and financial institutions to offer more personalized services to particular target groups and gain their loyalty and trust. Companies that have AI chatbots will be more successful than those without because of their continuous interactions with customers and training to identify new topics and increase the area of customer service and support they can cover.

Who can be the users of chatbots in banks and financial institutions?

Customers are the first thought, and they are for sure the main users that benefit from self-service options and contactless support. Meeting their needs and making their experience worth it are the companies’ main goals to accomplish along with making a profit which is one of the results of that.

However, there is another group that can benefit of using a chatbot – that are the company employees who can use this technology too. The staff can use a chatbot for fast access to up-to-date company information, for their onboarding when they are new in the company, for internal training and HR services, and to automate administrative tasks.

Both customers and employees can help banks and financial institutions meet their goals with the use of an AI chatbot and many already are doing it.

As with every technology, banks can have some challenges too, when implementing a chatbot with AI, however, the proper planning and implementation can help avoid them:

– Chatbots built on not well-structured data cannot perform well and that can be avoided with better organizing and fully planned project with the right assignees.

– As chatbot technology constantly evolves, banks and financial institutions have to keep up with the trends to stay competitive. Working with a good partner-provider of the chatbot service will help the bank to be up to date with new trends and functionalities.

– AI chatbots that are based on machine learning must be constantly trained to perform well and must be given the human touch and way of communication to avoid the lack of emotion and users to feel them no different from human interaction.

Some examples and future trends

There are some examples of banks that already have started using the technology and achieving great results, according to Insider Intelligence: Chatbots can use AI to guide customers to the right human-based experience:

• Bank of America’s Erica which is an AI-driven virtual assistant with growing interactions every year
• USAA has Eva, a chatbot that handles simple banking tasks
• S. Bank’s virtual assistant, Smart Assistant – was released as a Spanish language assistant – is one of the first of its kind in the US.
• Digital customer service provider Glia recently acquired Finn AI, an AI-powered virtual assistant platform that will give smaller banks and credit institutions mainstream access to an AI-driven chatbot tool.

According to a report by Juniper Research entitled “Chatbots: Banking, eCommerce, Retail & Healthcare 2018-2023”, chatbots can save banks up to $11 billion per year by 2023. Integrating chatbots into mobile banking applications will be the main channel of customer communications, which will be 79% of the successful interactions in 2023. As we mentioned in our previous blog post there are other specific examples of well-performing AI chatbots – Capital One’s chatbot Eno and Bank of Montreal’s chatbot Bolt, as well as BNP Paribas Personal Finance’s Chat Assistant Chatti, which is just a basic chatbot with predefined information for checking a financial account. According to an article by Business Insider Intelligence, the aggregate potential cost savings for banks from AI applications is estimated at $447 billion by 2023, with the front and middle office accounting for $416 billion of that total, per Autonomous Next research. That also means banks and financial institutions are more than ready to introduce AI digital assistance as part of their services for better customer communication and support.

In Bulgaria, the banks that benefit from this technology are Postbank, which uses a chatbot named Eva – the first bank chatbot in Bulgaria, and First Investment Bank invests in its chatbot named FIbot, which supports customer service and is developed based on frequently asked questions which usually customers address to call-operators. Many banks and financial institutions started using the technology not only in the most developed countries but also spreading globally because the needs of the banks as business, customers, and employees for savings, optimizations, and 24/7 service are increasing every year and the technology is there to meet them.

See how the world goes towards AI chatbots regardless of the industry and if you want to be part of this digitalizing world, you can start your chatbot path now to have a fully working AI digital assistant for a few months. Feel free to contact us and do not forget to stay updated on the chatbot world and its possibilities by following our LinkedIn account.