smart banking with artifical intelligence
DESCRIPTION
Homo Sapiens – man the wise is the scientific nomenclature of humans because our metal bandwidth is key to our existence. The field of artificial intelligence (AI) attempts to understand mechanics of such intelligent entities and build similar intelligent entities - which are able to automate solutions to complex problems: to analyze the current state, predict behavior and model the optimum management solutions.Regardless of whatever definition we may have – “ smart machines”, “intelligent automation “, “cognitive computing “ - AI is enjoying a renaissance at present because of impact it has on businesses of today and the promise it holds for tomorrowBricks+Clicks’ distribution model, significantly reducing the number of branches and digitising the back and front office of available branches with AI Powered solutionsTRANSCRIPT
I 1
The key constructs of Artificial Intelligence, as we understand: -
! Thinking humanly: The cognitive modelling approach - simulate the actual workings of
human minds.
! Thinking rationally: The laws of thought approach - - codify "right thinking," that is,
irrefutable reasoning processes.
! Acting rationally: The rational agent approach - achieving perfect rationality—always
doing the right think
Our increasing knowledge about the mechanics of the human brain and our ability to embed
brain-like elements into computers have engendered such capabilities as natural language
learning, voice &pattern recognition, machine learning. Such capabilities today are yielding
practical benefits for Industries - question-answering medical diagnostic systems, credit scoring,
program trading, fraud detection, product recommendations, image classification, speech
recognition, language translation, automated financial advisory and self-driving vehicles
Banking & Financial Services Industry , which has traditionally been the early adopters of new
technologies have shown great inclination towards AI as the opportunities are limitless even
though the business value benefits are evolving. In the BFS Industry domain , AI solutions have
the potential to bring about innovations in problem solving capabilities and improving the
productivity of human staff towards delivering superior business outcomes. - attaining new levels
of process efficiency, such as improved operational cost, speed, accuracy and throughput
volume
Homo Sapiens – man the wise is the
scientific nomenclature of humans
because our metal bandwidth is key to our
existence. The field of artificial intelligence
(AI) attempts to understand mechanics of
such intelligent entities and build similar
intelligent entities - which are able to
automate solutions to complex problems:
to analyze the current state, predict
behavior and model the optimum
management solutions.
Regardless of whatever definition we may
have – “ smart machines”, “intelligent
automation “, “cognitive computing “ - AI
is enjoying a renaissance at present
because of impact it has on businesses of
today and the promise it holds for
tomorrow
Advantage AI - Smart Banking
Banking & Financial Services
I 2
Bricks+Clicks’ distribution model, significantly reducing the number of
branches and digitising the back and front office of available
branches with AI Powered solutions
The drivers for banks and financial services
to adopt these technologies can be
classified as under:-
Compete with Non Bank companies -
Technology companies like google , apple
, wealthfront etc who have disrupted the
payment services and wealth
management services ( Robo Advisors)
and are looking to tresspass more into the
traditional areas of banking
Managing the mass of millennials – They
are now the largest, most diverse
generation in the U.S. population as per the
Council of Economic Advisers, President of
USA. In years to come , this age group will
form the key customer base of the banks
and will shape US economy for decades
to come. Hence, its imperative that Banks
takes them seriously
Outperforming their peers - Managing
growth in a competiting marketplace ,
opportunity for cost saving is significant
with AI and process automation - cost
savings from front office automation and
customer-facing functions ,Reduced error
rates, Improved standardization of process
workflows , Fraud management etc
Many Financial Institutions understand the
benefits and impacts of AI. Retail banks,
Asset & Wealth Managers, Brokerage firms,
Investment Banks are all experimenting
/implementing AI solution in various facets of
their “ Business As Usual “processes
In retails banking, AI solutions can deliver
wonders, both in customer experience and
cost. Such solutions can be implemented as
part of future of bank strategy wherein it
enables digital experience for customers in
branch.
Imagine customers being greeted by AI
powered Robots in the bank branches in
customer’s language of choice (driven by
customer persona) and enable their
customers to set up an account or help with
other administrative issues.
It can also support additional functions like
Tellers, Mortgage brokers, insurance claims
and policy processing, insurance
underwriting etc. Such arrangements not
only drive efficiencies but also drive
significant cost optimization for bank’s
branch operations.
For instance, a leading bank has installed AI
powered Intelligent Kiosks to address the
financial planning requirement of their
customer who are transitioning from military
service to civilian life
Robots like Nao (at Bank of Tokyo-Mitsubishi
UFJ) and Pepper (at Mizuho Bank) are
playing the role of customer relation
executives at branch and are driving
excitement amongst the customer groups.
Interestingly, Pepper could become the first
humanoid consumer robot and the
beginning of an era of mechanized, cloud-
connected ’emotion-reading’ digital
assistants.
Pepper went on sale to the public in June
2015 for approximately $1,600, the robot
communicates in multiple languages, using
sensors and cloud-based artificial intelligence
(AI) capabilities and has the ability to evolve
its skills over time through continuous learning.
In the heart of Pepper is an “ emotion
engine” through which it recognizes human
feelings and simulates accordingly.
That said, more banks are making forays into
investing in technology companies making
robots that can answer "complex financial
questions posed in plain English. Innovative
way to address customer interactions and
deploy smart assets in customer facing role.
Data-driven AI applications to make better informed lending decisions
Automated agents that assist the user, over the Internet, in determining insurance needs
AI solution for monitoring users’ behavioral patterns to identify anomalies and warning signs of fraud attempts and occurrences, to identify and prevent bank frauds
I 3
Fraud management is another significant
area where AI powered solution can play a
significant role. It is often frauds that expose
the most vulnerable part of banking, leading
to loss of reputation and customers.
The intent to apply artificial intelligence,
without relying on manual banking systems,
to get an early warning on frauds is
underway and some of the leading global
banks have been experimenting with it. There
has been a paradigm shift in fighting fraud
from “cloak-and-dagger” techniques to
more sophisticated early warning detection
and prevention based on expert /Intelligent
systems.
Unlike expert systems of the past, which
required rules to be hard coded into a system
by a human expert, Brillio ‘s patented PRISM
can process natural language and
unstructured data and learn by experience,
much in the same way humans do. PRISM
acts as a decision support system and helps
to curb bank frauds in much more proactive
way.
Brillio’s patented! technology in cognitive
analytics have inbuilt machine learning
algorithms to sense, predict, infer and think.
This solution can be applied in many more
areas of banking beyond fraud and
customer service, example in the area of
Wealth & Asset Management, especially in
Fiduciary Service.
In the last couple of years, Automated
financial advisors, commonly referred as
Robo Advisors, have invaded this space.
Initially when launched, they disrupted the
advisory services to an extent that there was
a sense of panic amongst the traditional
players.
However, of late many such traditional firms’
have appreciated the need for digital wealth
management and are looking to compete
with combined offerings of advisors
leveraging these platforms to serve the mass
affluent.
Overarching individualized investment
strategy enabled by these AI solutions for the
consumer trumps generalized product sales
within a brokerage format.
In this sphere, Brillio’s solution enables
Traditional advisors seeking to automate their
financial advisory that not only expand its
Direct-To-Consumer capabilities but also
helps to leverage such automated platforms
for advisor solutions and offer the technology
platform to a wide range of broker-dealers,
insurance companies, banks, and custodians
to turn their human advisors into tech-
augmented "cyborg" advisors
Market trends clearly implies that some of the
leading traditional players have not only
adopted such automated platforms but are
also leveraging such platforms to distribute
ETF’s through this new channel.
Both the Robo -advisors and the traditional
firms are driving the cost of Robo-technology
down to zero, relying on their ability to profit
from the traditional channels of
manufacturing investment products (e.g.,
ETFs) and delivering personal financial
advice, and out commoditizing the Robo-
advisor.
Overall, the market for AI systems for
commercial enterprise applications is
growing at 55 % CAGR (approx.) as per
analysts reports. This clearly indicates that
the AI is gaining momentum in commercial
enterprises across the globe including
Banking and Financial Services.
Therefore it’s imperative that the industry
captains put on their “thinking cap” and
envision where AI has the potential to disrupt
their business or even their entire industry.
Market for AI systems for
enterprise applications
expanding at approximately
55 % CAGR
Automated financial advisors and planners that assist users in,
providing customized financial advice Market for AI systems for enterprise applications will approx. $11.1 billion by 2024
I 4
At Brillio, we work with some of the leading brands across different Industry Segments. DigitalSIGMA is Brillio ’s interwoven digital technology stack with integrated execution model which allows us to enable our clients in their digital transformation initiatives – Our structured execution, agile accelerator methodologies, baked-in platforms allows us to think big, start small fail fast and scale quickly. DigitalSIGMA helps in faster adaption of key digital forces required to address unique needs to each Industry, thereby enabling our clients to re-think their business models and processes, create experiences inspired by customers, uncover insights to shape products and services, engage better with employees and business partners. DigitalSIGMA @Brillio delivers end to end in Digital initiatives – From Imagination through Implementation led by global team which includes thought leaders, consulting and strategy experts, business analysts, user experience designers, data scientists, and engineers trained in the latest technologies.