Banks adopt Artificial Intelligence to beat competition.

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Faced with the challenge of trying to stay profitable in the face of a tough operating environment, some of Nigeria’s leading lenders are following the footsteps of their global counterparts and rushing to embrace Artificial Intelligence (AI). 

In its report published early last year entitled: “Banking Technology Vision 2017”, which studied how Artificial Intelligence (AI) will affect banks in the coming years, global professional services company, Accenture, carried out a survey of over 600 of the world’s leading bankers during, which they were asked about AI and how it’ll impact banks’ internal and external operations.

The report disclosed that four out of five of the bankers surveyed predicted that the new technology will become the primary way banks interact with their customers.

Specifically, they (bankers) stated that it will significantly change customer service in banks, adding that they expect AI technologies, such as chatbots, to become increasingly essential for banks in the next few years.

Furthermore, it revealed that when asked to identify the top three advantages that banks may derive from the adoption of AI, the respondents most often cited, “to gain data analysis and insights” (60per cent), “increase productivity” (59per cent) and “cost benefit savings” (54per cent).

Commenting on the report, a Senior Managing Director at Accenture and head of the company’s Banking Practice, Alan McIntyre, stated: “Consumers’ diverse needs and priorities are forcing financial services firms to redefine how they interact with them to determine the best products and services to meet individuals’ needs.

“AI-enabled tools can help banks identify consumer preferences and empower their workforces to react with insight and emotional intelligence, which is essential for the development of meaningful consumer relationships.

The challenge will be how quickly banks can implement these new technologies, many of which are not compatible with their existing IT infrastructure.”

 

‘Next revolution in retail banking’

Similarly, in a recent report, international research and advisory firm, Gartner, forecast that by 2020, customers will manage 85 percent of their association with a business with no human interaction. According to brittanica.com, the term, AI, refers to: “The ability of a digital computer or computercontrolled robot to perform tasks commonly associated with intelligent beings.”

The phrase is frequently applied to the project of developing systems endowed with the intellectual processes characteristic of humans, such as the ability to reason, discover meaning, generalize, or learn from past experience.

In fact, in the last few years many banks in the advanced economies as well as tech-savvy firms such as Apple, Amazon, Facebook, and Google have introduced such a wide variety of AI technologies including chatbots, personal assistants, and robo-advisors that the consensus among experts is that this technology could revolutionize the traditional style of banking world-wide. Significantly, in a recent note, entitled: “Is AI the next revolution in retail banking?”

, a Strategist at Swiss global financial services company, UBS, Philip Finch, stated : “Based on our UBS Evidence Lab survey of 86 banks, an optimal scenario of limited disruption suggests AI technology could potentially lead to a 3.4per cent revenue uplift and cost savings of 3.9per cent over the next three years.”

The company, which has already launched a “robo advisor” — a digital tool that uses machine learning to offer automated investment advice based on people’s financial circumstances, stated last year that it had invested $11 billion into artificial intelligence since 2010, adding that the figure is set to rise to more than $47 billion by 2020.

 

UBA launches ‘Leo’

Facing unprecedented challenges triggered by the sluggish economy, it, perhaps, came as no surprise to industry watchers in these parts that Nigerian banks are now starting to adopt AI in their bid to gain a competitive advantage.

For instance, some days back, Pan-African financial institution, United Bank for Africa (UBA) Plc, launched “Leo”, a UBA Chat Banking personality, which enables its customers make use of their social media accounts- for now, Facebook Messenger- to carry out key banking transactions.

The lender stated that with the new solution, customers will be able to open new accounts, receive instant transaction notifications, check their balances on-the- go, transfer cash and do airtime top ups.

In addition, users will be able to perform other transactions using the chat banking such as payments of bills, data top-up, mini-statements, loan applications; cheque confirmation, account freezing, among others.

Bankers are coming to agree that, The formulation of this product is consistent with the bank’s customer 1st philosophy, where we are doing things not the way we like, but exactly what the customers want, where they want it, and in the exact platform they want.

“And so, we have been working with technology giants from around the world because for UBA with so many customers, we have to deal with those who have the global capacity.

Therefore, UBA has collaborated with facebook to come up with this.

In future, it is believed that Leo will show up with other platforms and all customers have to do is to open a facebook account.

Culled from NewTelegraphonline.

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