Can GenAI Restore the ‘Humanity’ in Banking that Digital Has Removed?
Remote banking via mobile apps and the web made service more immediate and convenient. But increased digitization also excised much of the human touch that connected customers with their banks. Accenture's Michael Abbott thinks increased use of generative artificial intelligence can re-animate the relationship for both customers and institutions.
By Steve Cocheo, Senior Executive Editor at The Financial Brand
Consultant Michael Abbott knows an Irish banker who recently received a deposit of €150,000. The funds arrived in the man’s account digitally and things might have ended there, just an unremarked large deposit.
As it happens, Abbott’s banker friend wound up talking to the customer. He learned the man’s father, a commercial fisherman, had died, and the inheritance had come to €150,000. He had no idea what he ought to do with the money and simply stuck it in his account.
Had the deposit not surfaced to the banker’s attention, there might never have been any timely human-to-human communication, and the customer’s funds would have sat, comparatively idle, in the account, for who knows how long.
Or the funds could have left if another provider had dangled something more attractive.
Abbott blames digitization for this kind of blindness.
"We’ve made banking functionally correct, but emotionally devoid," says Abbott, senior managing director and global banking lead at Accenture.
Digitization hardened banking customer journeys into channels that granted efficiency but often removed humanity and connective thinking from the equation, Abbott continues.
"Customers don’t have conversations anymore, the way they did when they routinely did their business in branches," says Abbott. Digitization became a barrier.
A new study from Accenture, "Banking: The Future Is Back," notes that digitization provided transactional service, but left alienated customers craving more. "Most of those who use the bank’s chatbot find it quick and responsive but infuriatingly limited," the report says. Or they found themselves in telephone tree hell, struggling to get to a human.
The industry isn’t going to reverse direction and abandon digital services. But Abbott believes technology holds the answer to not only reinstating the emotional aspects of banking customer experience but also turning good bankers into better bankers.
The key will be widespread adoption of GenAI, initially as a behind-the-scenes tool to helps bankers spot customer needs and opportunities.
Can the ‘Bank of One’ Finally Be Realized?
Along the way, Abbott also sees GenAI as the means of achieving something that banks have talked about for a long time: Creating a "bank of one" by tailoring each banking institution’s menu of services into unique packages for each customer. Abbott says this has not been possible to do with consumers at scale with existing tools — but could be with GenAI.
"AI will restore the sense that customers are recognized and understood," the study says. The study says flexible service, based on AI direction, will shift the conversation from "why we can’t do this" to "how might we do this?"
Fair warning from Abbott: Even though GenAI was barely a thing three minutes ago, it won’t be long before institutions that don’t begin exploring it will find themselves at a disadvantage. He says it’s conceivable, in a time of open banking, that consumers could use GenAI on their own to create a "Bank of Me." Under the customer’s instructions, an artificial intelligence agent would do the tailoring — picking services from multiple providers and linking them externally.
Banks have an opportunity now to tap the technology and use it to reestablish human connections with customers — and Abbott insists that banks of all sizes can compete in this AI-supported melee.
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GenAI Will Revamp What Digital Banking Looks Like and Does
"In the future, the bulk of the bank’s interactions with its customers will be handled by AI-powered agents," according to the report. "As these semi-autonomous task-specific software programs work their way into every interaction and channel, we envision a future dramatically different from today, yet more like the past."
Abbott is not arguing for turning customers directly over to GenAI — not yet. Even the most-advanced pioneers his firm works with aren’t risking that. Right now, augmentation of the human element is the key.
In the scenario Accenture envisions, much of what is accepted as state of the art digital banking will evolve or even cease to be, at least as we know them now. The thinking is that the tailoring that GenAI will permit will take the industry away from hard digital channels and encourage flexibility.
For example, the report suggests that most banking websites will become quaint historical artifacts. They will be replaced by conversational digital interfaces that bear more resemblance to working with humans. The report says that some banks are already experimenting with AI avatars that work with customers in an environment much like a Zoom conversation.
Similarly, Accenture sees mobile banking apps evolving into experiences that adjust on the fly to the customer’s needs in that moment and in the context of what the bank knows about them. The report predicts that the apps will "feel more like texting with your bank-manager friend who always remembers where you left off" — a banker in your pocket.
Thus far, the new experience described is human-like. The firm sees even interactions involving people developing into a new experience.
Two areas are contact center staffs and relationship managers. AI will serve as coach to the banker as they work with customers, making conversations still routed to people more effective for the customer.
Abbott says Accenture has been working on improving relationship managers with AI and has found that the sweet spot for the technology is in the middle.
"Every bank’s relationship manager group has a performance curve," he explains. "You’ve got people at the very top end and you’ve got people at the very bottom. We’re finding that you’re not going to make the best better — they’re already good as they are. But you can improve the middle of the curve using GenAI."
Abbott says GenAI could monitor relationship managers’ conversations and alert the bankers when they go off the beam. The AI could spot cues that suggest that a particular consumer is not a candidate for a retirement account — but other cues may suggest that they would be interested in hearing about college savings plans.
Redirected conversations like that can take AI beyond the typical cost-saving role to a revenue-building role, says Abbott. Spotting opportunities can drive cross-sales. This would reinstate some of the opportunities lost to impersonal digitization, he maintains.
"Banks are going to find ways to blend the human and the technology," he says.
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How Banks Can Segue into GenAI without ‘700 PhDs’
Abbott says that many of the big headlines about GenAI involve major banks, such as developments at JPMorgan Chase, where 150,000 staffers are learning how to use the megabank’s own private version of ChatGPT. But that doesn’t mean that only the big banks can play.
"For community banks, the magic here is that the cost of using GenAI no longer requires your institution to buy 600 or 700 PhDs," says Abbott. "Instead, it’s going to be more like using Excel."
Being able to use AI out of a box, so to speak, will enable smaller institutions to apply it in unique ways to their peculiar strategies and operations. This "democratization" of GenAI is making it possible for smaller institutions to begin working with the technology in a serious way. Abbott says he’s been working with some community banks to explore the possibilities and finds that while large institutions are hoping to implement the tech across the board, smaller players’ best opportunities might be to use it for specific applications.
The smartest players intend to use GenAI to grow, not merely to shrink expenses, according to Abbott.
"If you just think about taking out expenses, you will probably shrink versus your competitors," Abbott says.
Referring again to Excel, Abbott points out that initial fears that the software would slash finance jobs proved to be unfounded. If anything, he says, there are more people in finance today, but they are doing more valuable tasks than filling in blanks in green ledger sheets.
On the Job: Managers Will Need to Learn the Skills Too
Abbott believes GenAI, as it becomes a standard part of banking, will play out in a similar way. Employees will adapt, often more slowly than anticipated, but they will change. This will lead to shifts in the role of management vis-à-vis employees empowered by GenAI.
Abbott says this will likely take a similar path to that seen as banks adopted agile development. Young people came into the bank using the tools, just as many are already experimenting with GenAI. Banking leaders liked the idea of their organizations "doing agile." But what Abbott calls "the frozen middle" management tier had to grin and plunge into unfamiliar turf.
"That frozen middle will have to thaw out and find a new way of working," says Abbott. Bank leadership must help by providing tools and opportunities for trying it out.
One of the biggest early challenges will be tempering the GenAI tech to the task. Abbott explains that GenAI can be tuned to be "low temperature" or "high temperature," or somewhere in between. The former refers to GenAI working with tight guardrails, such as in sensitive areas like dispute management. "You want the temperature of that to be zero," he says.
On the other hand, high temperature GenAI might suit the marketing department — at least on the first pass.
"If you’re in marketing and you’re developing new creative content, you might say, ‘Hey, go wild. Give me whatever you’ve got, and we’ll take a look at what comes back’."
The bank might like what it sees. On the other hand, says Abbott, "You might say, ‘Well, I’m not going to put that out there."
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