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These Banks Are Using AI To Help Their Customers Manage Their Finances Posted on Sep 12 - 2018

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While many companies struggle to figure out what to do with AI, a few are emerging as leaders in deploying it, with only a handful succeeding in incorporating AI in the sensitive area of customer relations. The Royal Bank of Canada (RBC) and Israel Discount Bank, using an AI platform from Personetics, are premier examples of how to do AI right, right now.

RBC is focusing its use of AI on “solving real customer problems—and the number one source of anxiety for Canadians is managing their finances,” says RBC’s Peter Tilton, Senior Vice President, Digital. “In finance, like in any other field, people want and expect faster, easier, more accessible and proactive service,” says Arik Frishman, EVP and head of the digital and data division at Discount Bank. “AI is the main enabler for all of these,” he adds.

The successful use of AI by RBC and Discount Bank is far from a common experience. While expectations for AI are “sky-high,” the gap between “ambition and execution is large at most companies,” concluded the Boston Consulting Group and MIT Sloan Management Review after surveying more than 3,000 executives, managers, and analysts across industries. Only one in 20 companies has extensively incorporated AI in offerings or processes and less than 39% of all companies have an AI strategy in place, they found.

This gap between expectations and reality is quite pronounced in the financial services industry.  A 2018 survey of industry executives found that 93% of respondents said their organizations were investing in AI initiatives. But… digging further, Tom Davenport and Randy Bean discovered that these financial services companies “were doing lots of pilots, proofs of concept, and prototypes, but they had few production deployments. When they did have AI systems in production, most were machine learning-based systems that had been in place for many years.”

Davenport and Bean recommend adopting “technologies that can scale and that can be used by the intended audience.” The Boston Consulting Group’s report highlights “one sizable difference” between AI leaders and laggards—their approach to data. “AI algorithms are not natively ‘intelligent,’” says BCG.  “They learn inductively by analyzing data.”

Indeed, adopting and customizing mature, proven, and scalable AI tools and a clear understanding of the role of data and its analysis in AI implementations are two key ingredients in RBC’s and Discount Bank’s success.

Both banks have added AI capabilities to their mobile banking applications by working with Personetics, a FinTech startup that combines financial services domain expertise with deep knowledge and experience with predictive analytics, machine learning and natural language understanding technologies. And top management at both banks understands that “digital,” in banking and elsewhere, means “data for personalization and precise predictions.” View More

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