- February 12, 2021
- Posted by: Mani Parthasarathy
- Category: Fintech
Customer experience (CX) in the banking sector is key, especially during and after the pandemic. How banks interact with their clients determines the strength of the relationship between the two—and it must be built on delivering optimal CX. However, creating this experience can be difficult.
Over the years, the way banks communicate with their clients has changed dramatically. In fact, according to a survey by FIS, 75% of all customer interactions with banks are done digitally via online or mobile. And many of these are made through voice and chat apps. In other words, conversational banking is revolutionisng the banking experience.
In this article, we’ll be taking a look at exactly why this is happening, including the technologies behind it all, and how it will benefit traditional financial institutions.
Let’s dive in.
What is Conversational Banking?
In the past, banks would communicate with their clients face to face, or over the telephone. There was always a human acting on behalf of the bank.
With conversational banking, the need for a human is reduced, while the customer experience improves.
Conversational banking is when the bank brings text and voice into their interactions with a client. These interactions are delivered on the side of the bank and are powered by artificial intelligence and machine learning. This occurs on a self-service channel, via fintech chatbots and more advanced messaging platforms that can be customized.
Don’t worry, while the client is talking to a robot it won’t feel like they’re talking to one. Because some voice and chat bots utilize natural language processing (NLP), they’re able to communicate with clients in such a way that they come across as human – friendly, approachable, conversational. A client asks a question – be it about loans or credit cards – and the bot responds in a familiar fashion by putting context and meaning to user inputs.
Not just that, but because the bots use machine learning, they’re able to hyper-personalize the chat by learning and analyzing data about the specific customer they are talking to, which further enhances the customer experience.
That all said, if a client isn’t getting the answers they need, the bot can still forward them to a human operator.
How are These Conversational Technologies Changing the Banking Landscape?
Conversational technologies are evolving at such a rate that they’ve changed the banking landscape on a number of fronts.
Firstly, AI-driven chatbots are able to understand individual customers on a much more granular level than had been managed previously by the bank. These bots can gain insights into specific client’s lifetime value and profitability.
Armed with this data, the bot is able to create actionable insights that improve client interactions in real-time.
Secondly, conversational technologies are able to assist employees of the bank who can then react quickly to their signals.
For example, a chatbot could detect and then highlight a dissatisfied customer during a recent interaction. Then, the branch manager could reach out to the said customer and talk through their issues. In this way, conversational technologies are not only aiding and assisting the bank, but they’re also boosting the staff’s productivity and working alongside them – as opposed to threatening to make their roles redundant.
Thirdly, customer preferences are changing – they’re evolving, shifting towards digital payment methods, and they’re driven by conversational AI. And while these have made the customer’s experience convenient, they are at risk of completely eroding the traditional banking relationship.
The idea is that banks are able to leverage AI-driven chatbots and voice technology via self-service channels. This technology is available around the clock and lets clients complete simple requests, including adding a new payee and resetting a password. Even international transfers will be able to be completed in an instant. Incumbent banks that refuse to adopt this technology will have a difficult time competing with the fintech firms that threaten them.
Fourthly, let’s consider omnichannel banking services. The omnichannel approach entered the retail sector a few years back – and it’s finally entered the banking sector.
Here’s an example: Jerry has transactions to complete. He wants to be able to complete the via web channels and mobile. Jerry wants to use the likes of a mobile app to pay his bills, add new payees, apply for a loan and send money. And it’s by adopting voice and chat fintech that the bank is able to offer this omnichannel service to Jerry and boost his customer satisfaction.
What are the Benefits of Chatbots & Voice in Banking?
Voice and chat fintech provide a number of benefits in banking. These include:
1. Better customer service – As we’ve pointed out, customer service is paramount. But customer service isn’t always so easy to get right in terms of how quickly you resolve a customer query or grant them access to the information they’re looking for. Chatbots have changed the game in this respect and can help you achieve these sort of customer service goals more easily
2. Reduce phone waiting times and physical queues – Nobody likes waiting in line to talk to a representative, whether that be on the phone or in a queue at the bank. Thanks to the advent of voice and chat bots, waiting times are massively reduced because these bots are always on and always available to chat
3. Better, more personalized customer experience – 63% of clients now expect personalization as part of the customer experience. The great thing about chatbots is that they use machine learning to absorb and crunch customer data. This means that they learn about each specific customer, which then allows them to personalize the chat
4. Know your customers more – Chatbots can help you understand your customers and their needs so much more by collecting data from each interaction. You can use this data to figure out insights that you can then take action on, such as knowing when to reach out to a client (and what to reach out to them about)
5. More support for employees – There’s no need for your banking employees to fear the rise of robots. As opposed to threatening to make their roles redundant, AI-powered voice and chatbots are actually there to support your employees. For example, while a human operator can breeze through basic queries, they may need to turn to a data-crunching, machine learning driven chatbot to help them with more complex issues
6. Reduce costs – The banking industry hasn’t exactly been cost-effective over the years. But reports show that banks can slash their costs by as much as 22% come 2030, simply by implementing voice and chat AI
Use Cases for Chatbots & Voice in Banking
There are a number of ways you can use chatbots and voice in banking. Let’s take a look at some of the top use cases that are revolutionising the banking customer experience right now.
Chatbots are super highly skilled. They’re also really trustworthy. As such, they can be used to help clients:
- Pay bills
- Transfer money
- Setup payments
- Cancel payments
- Pay off credit card bills
The process is really simple, too. The client starts a conversation by telling the chatbot what it is they want to do today. The chatbot responds and quickly guides them along the path from A to B, requiring just a few responses and commands from the client.
1. Provide Balances
If a client wants to check their balances, they can ask a chatbot to bring their balance up.
Chatbots can do even more than that. They can also offer balance estimates, and they can send alerts to clients whenever their balance is at risk of falling below X amount. This improves the banking customer experience because it gives the client time to modify their account so that they’re not overdrawn.
2. Answer Basic Questions
Let’s say a customer wants to apply for a credit card. At this point, they don’t know how to do that.
So, they open up a dialogue box with a chatbot and ask them – via voice or text – how they can apply for a credit card.
The AI-driven bot responds with a helpful answer that covers the bases and moves things forward for the client.
Not just that, but the bot is able to do it in such a way that their answers are conversational, human, friendly and, of course, informative.
3. Review Accounts
Clients can have a lot of questions to ask about their accounts. They may want to learn more about recurring payments, transfer limits, card bonus points and more.
And while the bank could have a human employee on standby to answer all these questions, their time could be better spent on other tasks.
Especially when voice and chat fintech are able to retrieve each client’s account information in order to help them review and adjust their accounts.
4. Check On Transaction History
It’s not always easy for clients to manage their finances. Getting on top of their weekly and monthly spending would be so much easier if they had, say, a weekly or monthly report on their spending, right?
Now they can. All they have to do is ask bots to bring up these weekly and monthly reviews to help them stay on top of their finances.
Bots can also offer further insights to the clients, including insights on their spending habits and charges.
5. Send Reminders
Nothing weakens the banking customer experience than a late bill payment, especially if the client feels aggrieved that the bank didn’t send them a reminder.
Fortunately, chatbots are programmed to do exactly this. Whenever a client’s bill is due, the bot can send out a friendly reminder.
Other notifications can include alterations in credit scores, banking news and more. These can come in the form of push notifications that are helpful, and which improve the customer experience.
6. Flag Suspicious Activity
Voice and chat fintech is becoming increasingly sophisticated, and therefore helpful, at identifying suspicious charges and immediately flagging them so that the customer can take action. They’re also on hand to chat to the customer about any further concerns they have, as well as connect them to human operators if needed.
Voice and chat fintech are revolutionising the banking customer experience in numerous ways. AI-driven chatbots and voice technology enables banks to keep up with fresh customer demands and needs, ensuring the customer experience remains high.
And because competition in the banking industry is only going to get fiercer as we go through the COVID-19 pandemic, it’s important that banks adopt the available technology so that they stay relevant and innovative.