It is easy to forget in our busy lives how much we rely on institutions, specifically banks, financial institutions and businesses. The role of AI in these industries could facilitate improvements for employees and customers alike.
Big data has surfaced as a buzzword in recent months and can seem intimidating — big data is a set of analytical tools geared toward fast and meaningful processing of large data sets. You can see how this is useful to financial institutions. Artificial intelligence, often referred to as “weak AI,” are machines capable of performing specific tasks normally requiring human intelligence. These machines can complete the “busy work” piling up on your desk.
Here’s how big data and AI may play a role in your financial institutions next year.
Say Goodbye to Busy Work and Hello to AI
A widely cited study by Oxford University professors says robots will replace an estimated 47 percent of U.S. jobs in the next 10 to 20 years. What exactly would it look like for robots to take over jobs in the workforce? The goal is not to put American workers out of business — it is more about efficiency and the efficiency of having a robot doing the busy clinical work so that the skilled employee can focus on more important work.
By eliminating the repetitive tasks soaking up an employee’s day, companies can better utilize their employee’s skills for higher value tasks. Along with giving employees the opportunity to work on higher-value skills and functions, AI can also eliminate the amount of human error associated with these essential but repetitive tasks.
Increasing Cyber Security for Financial Institutions
Beginning in 2018, many financial institutions will begin investing in new systems such as AI and big data to maintain security.
Financial institutions often have handled information and investments of hundreds to thousands of people. Therefore, the security of these institutions is of the utmost importance. With cyber-attacks happening more often than ever, banks, financial institutions and other businesses, have put cybersecurity as top priority. Banking cybersecurity software will be crucial in 2018 to protect customers and financial intuitions from hackers.
AI Could Equal Better Customer Experience
AI offers another opportunity to increase business functionality in the realm of improving customer experience.
AI offers an advanced analysis of patterns and trends as far as customer satisfaction. AI might even help identify nonstandard behavior patterns. Companies can also use AI to model how customers may react to different scenarios and can test assumptions.
AI’s Help with Regularity Demands
Already retail banking organizations have started using AI to keep up with the growing regulatory demands. Citigroup says banks like J.P. Morgan and HSBC had to double the number of employees to help handle compliance and regulation. This additional hiring has cost the banking industry around $270 billion per year. The $270 billion accounts for almost 10 percent of its operating costs. To combat these extra financial burdens, companies have shifted from human labor to AI to keep up with the demands of regulators.
AI software solutions can help make sure the institution is compliant with all of the regulations. Some software even includes reporting tools used in case of a breach to ensure all notification requirements are fulfilled.
Big Data’s Role
Big data is big in the financial sector. High volumes of quotes, market data and trade data are regularly produced. This data all need processing as a high velocity to be efficient, otherwise who knows how long it would take for humans to go through and process this data. For financial markets, faster data processing equals faster management of trading.
As far as big data goes, it helps process a large volume of data at a high velocity and uses various formats and sources to process that data. For example, in corporate banking, institutions work with reference data, market and trade data and other sources, which means big data needs to work with a variety of data using a variety of methods to process it all.
Big Data and AI Necessary for Business
Yes, big data and AI are new and complicated. Reading about them may cause the eyes to glaze over. However, big data helps process a large amount of data, including our information, accurately, quickly and efficiently. AI allows you and fellow employers and employees to stop the busy work and enjoy meaningful tasks. And don’t forget, it can improve customer experience.