AI helping to streamline banking & finance processes, says experts

The maturity of AI, machine learning, and RPA presents new opportunities for the banking & finance sector

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AI helping to streamline banking & finance processes, says experts From chatbots to automated document handling, streamlining business processes to customer behaviour analysis, financial institutions of all kinds have begun to embrace the possibilities.
By  Alexander Sophoclis Pieri Published  November 8, 2017

The rise of artificial intelligence (AI) has brought with it new opportunities for organisations across a variety of sectors, to expand their technological prowess and to truly revolutionise how they do business.

While adoption of AI and its depth varies from sector to sector, the last year has seen a marked increase in interest from the global banking and finance market. From chatbots to automated document handling, streamlining business processes to customer behaviour analysis, financial institutions of all kinds have begun to embrace the possibilities surrounding technologies, such as AI, machine learning and robot process automation (RPA).

As a global leader in AI development, US-based technology firm IBM has for the last decade worked diligently to not only advance the field of artificial intelligence, but also devise novel solutions around its application in different verticals.

Gaining prominence across the global market with the successes of its cognitive platform, IBM Watson, particularly with its adoption within the healthcare environment, the company has continued to develop its capabilities in the arena.

Its latest efforts have been focused on bringing artificial intelligence to the Cloud.

“We’ve built the IBM Cloud with AI and machine learning capabilities to be highly differentiated … it is optimised from the chipset to serve the end-user experience. The platform allows clients to integrate data from their existing system with other kinds of data in the cloud — and uses AI to make sense of all of it,” comments Mohammad Riaz, managing partner, IBM Global Business Services, Gulf, Levant and Pakistan.

“This is a departure from what cloud computing used to be — and still, largely, is. Since the invention of Cloud computing roughly 10 years ago, Clouds have looked and functioned like commodities, allowing enterprises to store and access their data and software from anywhere, with greater flexibility and at a lower cost.”

In terms of the banking & finance environment, IBM recently developed a cognitive solution with HSBC that is designed to support the digitisation of global trade. The new platform combines optical character recognition with advanced robotics to improve efficiency and safety in global trade, as well as streamline the processing of documentation utilised in international commerce.

Combining IBM’s advanced analytics technology, which includes intelligent segmentation and text analytics, the new solution is able to digitise and extract key data in critical documentation. The information is then shared with the bank’s transaction processing systems, which in addition to freeing up staff to engage in other activities, is also substantially more accurate than traditional processes.

“At IBM, we believe that enterprises — and the professionals who serve them — will succeed or fail because of data. And we are not talking about data that is on the Internet. We are focused on the 80% of data that is not searchable. It belongs to companies and institutions,” asserts Riaz.

“This is a gold mine, and it’s why businesses shouldn’t fear being disrupted by a player that has search data or social data. Theirs, instead, is actually the most valuable data in the world. They just need to take advantage of it. But most enterprises are not prepared to.

“Machines will be able to handle a large amount of the work that humans in banking services do today, which includes collecting and organising information to create reports and meet regulatory requirements. This will allow employees to utilise their time and expertise in a more strategic manner.”

The managing partner also adds that another area that has the potential to be transformative is the application of Fintech AI on client services. He points out that certain banks have already implemented or in the process of deploying virtual teller agents that are capable of responding to queries and also advise possible solutions to customers.

During last month’s GITEX Technology Week, Julen Mohanty, vice president and regional lead for strategic business engagements at JP Morgan Chase, participated as a guest speaker during the event’s Vertical Days Conferences.

Focusing on the value of technology in helping curb operational expenditure and in the creation of a more efficient and leaner financial organisation, Mohanty’s presentation delved into technologies such as blockchain, machine learning and desktop robots.

“When somebody walks into your branch and requests a savings account, it takes time to take their documents, to verify those documents, and open an account. That takes a lot of time — probably a couple of days,” explains Mohanty.

“The idea is that the new system should be able to verify everything from the hard copy, or unstructured data, pull out the information that is required and verify it with the government or authorisation site. If you can verify the person within probably a couple of seconds, then the bank account can be opened in probably less than a minute.”

The VP and regional lead went on to add that a key component of this new system is robotic process automation, a term used to describe clerical process automation technology powered by artificial intelligence.

By utilising RPA to automate certain bank processes, the technology effectively cuts out the need for human input, which in turn allows bank employees to refocus their efforts on tasks deemed significantly more critical to daily operations.

“There is confusion with robotics that we will have less human or production costs. That is not the idea behind robotics. The idea is that the human intelligence should be used in an intelligent way, rather than doing redundant, repetitive work like reading a passport or updating a document in the system,” adds Mohantay.

“There is also business analytics. For example, if you open your Facebook or Twitter feed, there are a lot of ways that banks propose products, saying, ‘do you want to open an account with this ‘xyz’ bank?’ … they took a lot of metadata based on your [browser] activities, verified it and inserted it in an analytics system. Based on that they target their marketing.”

When pressed on the current status of the banking community when it comes to deploying this technology, the JP Morgan Chase noted that while banks are at the forefront of technology adoption, the processes behind the scenes typically remain the same. Instead he argues, “banks are going to open a new channel of business, with the same banking process.”

Using credit card offers as an example, he shares that while the marketing associated with a credit card will change over time, the approval process has not changed. It has however, been automated with robots.

“Banks have made a lot of acquisitions. When you acquire another bank, they also [operate] a number of applications, and integrating those is often very difficult,” adds Mohanty.

“In these kinds of situations, robotic process automation is going to be very useful because for a human, going to different systems, aggregating data and making information out of it is very difficult. But robotic processes can work 24/7 and do all kinds of repetitive work, so that you can get your data the way you need it,” he concludes.

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