AI is displacing jobs across industries, but at the same time is creating an opportunity to elevate people into more challenging roles that allow them to maximize their potential. Gartner estimates AI will create 2.3 million jobs by 2020.
As organizations strive to strike the right balance between man and machine, here’s some AI action we expect will take place in banking in 2018.
Firstly, in 2018 banks will develop a more nuanced understanding of the technology and will begin to appreciate the key building blocks – a strong foundation of data and analytics, machine learning, deep learning, natural language processing and generation, and visual recognition.
Among the applied solutions of AI, cognitive RPA will continue to garner interest, as will machine learning and deep learning. Natural language-based applications – chat bots, smart assistants etc. – will also find their way into banks that don’t have them yet. Progressive banks have experimented with NLP and NLG, and these have found application in a significant number of use cases. In 2018, fast followers and late comers will also adopt these.
2018 is also the year when AI use cases will go beyond the established applications of fraud prevention, customer service and risk management. For example, in the era of PSD2 and open banking, when banks will have unprecedented access to customer information, AI could accurately forecast future spends based on a customer’s activity dating back several years. Having said that, cyber security will still be the foremost use case for AI in banks in 2018.
However, while embracing the potential of AI, banks must also beware of its pitfalls. For example, machine learning is widely used, but there is limited understanding of how a result is arrived at or why it forecasts one thing and not the other. What complicates this, is that banks will not be able to validate a credit decision for the length of the credit cycle – in many products this is a year at the least!
AI will usher banks to the next level of efficiency and personalization. The technology will prove to be a huge differentiator for banks that understand it well, invest early, and work towards leveraging their workforce efficiently in the age of AI.
Read the full report here – #ReimagineBanking – 10 Strategic and Technology Trends to Watch Out for in 2018