Ease of access to information is a major challenge in the banking sector. An enormous amount of data associated with each customer makes it difficult for banks and other financial institutions to cater to every customer’s queries immediately. Evidently, restoring public trust and improving customer services are two grave concerns that need to be addressed in the finance sector. Conversational AI has attracted a lot of interest from financial institutions in recent years. Banks are increasingly relying on chatbots to provide top-notch customer service. Chatbots in banking are helping banks address their customers’ queries and deliver solutions, accurately and quickly.
A report by Juniper Research shows that for every query a chatbot handles, banks save 4 minutes of an employee’s time. As per the research, the use of chatbots across various verticals will save a whopping 8 billion USD per annum by the year 2022. Another study has found that by the year 2023, operational cost savings using chatbots in banking will reach a whopping 7.3 billion USD globally.
Understandably, it is an understatement to say that conversational AI, i.e. chatbots in banking are more than nice-to-haves and have become an inevitable tool to enhance customer experience and cut down on costs. To explore how banks can benefit from implementing chatbots, let’s first understand the challenges of the banking space that make chatbot a perfect fit for banks-
Challenges of the Banking Sector
As reported by eMarketer, more than 43% of respondents in a research survey said that they would rather communicate with a chatbot than a real person for navigating around their queries within banking institutions. Here’s why chatbots can be highly effective for banks and other financial institutions:
Banks need modernization
Even though a lot of banking institutions have started stepping up on the digital front, there is a lot more that needs to be done. For so long, banks have kept up with traditional and manual ways of carrying out processes. It’s high time banking processes become efficient and quicker. Implementing technological solutions effectively like chatbots means more efficient workflows, instant response times, increased speed of operations, and an overall improvement in productivity and customer satisfaction. (forecast growth accounts for 3,150 percent increase in banking chatbot interactions between 2019 and 2023)
Banks need customer-centricity
The customer has felt ignored for so long; walking into banks and waiting in long queues, only to fill a form, or deposit a cheque. Relying on legacy processes has rendered banks to struggle to retain customers. Customers now expect better services. Using chatbots, banks can improve customer centricity by offering faster services, self-service, and making information and services accessible 24*7. With a customer-centric approach, banks can regain their brand image and enhance brand loyalty by offering convenience to the customer.
Customers need personalized services
Chatbots provide the customer exactly what they are looking for by probing the visitor with a series of questions and offering relevant information in an interactive and user-friendly manner. This personalized experience makes your customer feel valued and contributes to customer loyalty. When a support rep has access to customer preferences, they also will be able to solve issues proactively and contribute largely to customer satisfaction.
Instant guidance on financial matters
The unavailability of answers at the required time results in hampered customer experience. But with chatbots, nobody has to wait. Chatbots are automated and can cater to the queries of thousands of people at the same time. Thus giving instant answers and helping you get more done in a limited amount of time.
It’s time banking institutions put their customers at the heart of their operations and devise a digital strategy that meets their needs faster and more efficiently. Chatbots in banking are proving to be the revolutionary tool that place banks and other financial organizations at a step ahead in the digital path, providing customers a friction-less experience and top-notch service.
Use Cases of Chatbot in Banking
Chatbots create a sense of availability in customer circles by helping them get things done, questions answered, and needs met – at any time, from anywhere. In the wake of this rapid adoption of latest technologies, it is imperative to explore how and in what manner banking institutions can leverage chatbots.
Elucidated below are some ways chatbots can impart value to the banking industry:
Create an Insights-driven Bank
In order to create a cognitive financial institution, we need the capability to capture the information provided by the user and gauge their sentiment and behavior. A chatbot can help consolidate this information and help banks make decisions that are powered by data-based analytics.
By analyzing the data from numerous interactions that the chatbot has had with the customers, banking officials can derive answers to important questions like:
- Which geographical region is expected to achieve the highest growth in the next year?
- Who are my biggest competitors in the banking space?
- Which employees from the customer service department are likely to leave in the next year?
- Which is the best customer segment to target the new mobile app?
Enhanced Customer Experience
Chatbots can help create powerful and compelling customer service experiences. Bots can assist customers any time and grasp the context of conversations to provide quick support without the need for human intervention. When needed, a chatbot can access historical customer service data to revisit customer grievances and steer conversations toward outcomes more efficiently.
Using chatbot-to-human handover, chatbots can even summon a human advisor in the conversation if the need arises. You can take the reigns from the chatbot when the customer asks for something your bot is not trained to address.
Through analytics implemented on chatbot conversations, banks can personalize the content and information sent out to each customer segment. Moreover, banks can even customize product and service offerings as per the preferences of the customers.
Improve Visibility into Customer Sentiment
Customer feedback gathering and analysis are the critical components of any banking service. Intranet-based chatbots can help banks get a clearer picture of customer sentiment, allowing them to improve services and exceed customer expectations.
Customers engage with chatbots more proactively than they do with forms and surveys. A primary reason behind this is the interactive and conversational nature of a chatbot, which is in contrast to the forms that are dull and tedious.
Replacing website forms with chatbots with proper planning has proven to be a successful business decision with increased conversion rates and better ROI.
By including feedback option into a banking chatbot conversation, banks can gain a better perspective into customer sentiment and work on means to alleviate the pain-points of their customers.
Generate leads with conversations
A chatbot integrated early on in a buyer’s journey can prove less intrusive than email or direct marketing campaigns, widely increasing the possibility of converting leads.
Lead generation chatbots can be integrated into a bank’s website, or mobile app and customers can initiate conversations and get their queries resolved in no time. This will streamline the customer experience and improve the chances of conversion.
Benefits of Chatbots in Banking
Now that we have seen the use-cases how chatbots can benefit the banks, let us have a look at the benefits that chatbots in banking entail:
Cutting costs while also fulfilling customer expectations is a difficult task. Thanks to chatbots, labour costs can be cut down significantly. A chatbot can automate the repetitive tasks of employees, allowing them to focus on more strategic tasks. Moreover, chatbots can interact with hundreds of customers at the same time, whereas a support executive can handle only a handful of queries at a given time.
Using chatbots, businesses can reduce customer service costs by up to 30%, according to Chatbots Magazine. Also thanks to cloud-based storage systems, chatbots don’t demand expensive data storage facilities.
Banking chatbots can handle a multitude of requests concerning different banking activities like inquiring about loans, account balance, different investment schemes, etc. This means you can allow employees to work on value-add jobs that need logical and strategic thinking. This way, employee morale is boosted and there is also an increase in employee retention.
As human agents have shift timings to adhere by and deadlines to meet, they cannot be addressing queries of customers/prospects round the clock.
FAQ chatbots answer straightforward questions so that your employees can focus on enhancing the customer experience and working on complex customer queries. Exceptional customer service is an integral part of the customer experience, and chatbots can help you have both.
What Can Users Ask A Banking Chatbot?
Chatbots in banking can be made to answer your customer queries promptly and help them gain access to information instantly. Here are a few questions a rule-based banking chatbot can answer efficiently:
- Can you share a list of the nearest ATMs?
- Can I make a transfer to the XYZ vendor right now?
- How much money did I spend on travel in the last two months?
- What are the best and worst case scenarios of launching XYZ service/product in the ABC market?
- Can you please display my account information?
- Please help me track my application?
- May I know the customer care number for my location?
- What are the investment options available for me?
- Can I know the interest rates and my eligibility for the XYZ product/service?
- Can you please help me reset my IPIN?
- Please help me pay bills/recharge/book tickets.
- Please block my card number XYZ.
- Can I explore the careers at the bank?
- Can you help me apply for the XYZ product/service?
Examples of banking chatbots in action
Wells Fargo’s Facebook Messenger-based chatbot leverages artificial intelligence to respond to user queries. It can help users find their account balance, list of recent transactions, display their spendings in specific durations, spot the nearest ATM, and a lot more. The chatbot is Wells Fargo’s latest effort to engage customers and serve them directly through Facebook so that they don’t have to separately log in to any other platform.
HDFC Bank’s EVA (Electronic Virtual Assistant) is a banking assistant developed with a focus on providing faster and better customer experience. EVA leverages Natural Language Processing to understand user queries and fetch information from the huge database.
EVA can fetch information about branch addresses, loan and interest rates, IFSC codes. The AI-powered chatbot can now also be accessed via voice assistants like Alexa and Google Assistant. EVA has answered more than 5 million queries with over 85 percent accuracy and holds 20,000 conversations every day with HDFC bank’s customers worldwide.
Erica by Bank of America is an AI-powered virtual financial assistant. The chatbot can effectively cater to the bank’s customer service needs by sending notifications to customers, sharing money management tips, offering credit report updates, facilitating bill payments, and providing balance information. As of early 2019, Erica has served 6 million users and serviced over 35 million customer service requests.
Amex bot is a Facebook Messenger-based bot by American Express. Amex card users link their cards with their Facebook Messenger account. They then receive messages and push notifications in Messenger, relevant to the purchases they make using their card. The Amex bot makes contextual recommendations based on their purchases, offers real-time sale notifications, benefits regarding credit cards, and more.
Ceba by the Commonwealth Bank Australia is a virtual banking assistant that provides real-time customer support. Ceba helps bank customers with over 200 banking tasks such as checking account balance, making payments, activating a card, or receiving cardless cash. Ceba is trained to analyze over 500,000 ways in which customers can request 500 different banking services, making it a very effective AI-powered tool for Commonwealth Bank.
Banks that have deployed their banking bots are evidently better equipped to provide a seamless experience to their customers. Study shows that by 2022, banks could automate up to 90% of their interactions with chatbots. Meanwhile, it is important to note that chatbots will not replace customer service agents but will enable them to focus on complex issues, while chatbots address the simple queries instantly.
While chatbots bring with them a lot of tangible benefits, it is important to have a planned roadmap of the chatbot deployment. It is also crucial that banks have clarity on the tasks they want to automate using chatbots. Proper planning with the right chatbot vendor is the key to successful chatbot implementation.
WotNot, a leading chatbot platform developed by Maruti Techlabs has assisted hundreds of companies across verticals in developing valuable and scalable chatbots that work as personal assistants and provide a seamless experience to the customers. What’s more, you can even experience the banking chatbot for free on their website before deciding to take a plunge. Experience the interactive banking chatbot here.