The New Age of Cognitive Chatbots in Banking

Published On : 01/30/2019

Technology is transforming the way we bank with smartphones and apps taking the lead as the key platforms. With the banking experience changing fast in favour of speed, ease and control for customers, another area that needs attention is customer service.  As customer service is a primary touchpoint between any organisation and its customers, it is essential that this side of the business should run like a clock with delays in responses, long waiting times and lengthy resolution processes being ironed out. Chatbots have been deployed to smoothen the edges of customer experience, providing fast and easy resolution to customer enquiries.

Deploying chatbots in customer service brings significant benefits to banking institutions, including resource and time efficiencies and increases in productivity. But while chatbot technology brings a lot of potential to banks and customers alike, not all chatbots deliver the quality of customer experience and service that today’s consumers expect. Below we look at different chatbot deployments and discuss why cognitive and voice technologies like Artificial Intelligence (AI) and Machine Learning (ML) transform customer engagement.

Chatbots’ bumpy start

Mark Troester

Chatbots have been around for decades, therefore, the idea of them acting as a customer service assistant is nothing new. However, they did not have the most impressive journey in the customer service sector, often described as clunky, hard to work with and one-way thinking.

This can be traced back to traditional chatbots being programmed with predetermined decision trees that only allowed them to perform a narrow set of actions. In addition, as this type of chatbots were typically not connected to backend systems, they could only draw on limited enterprise datasets to inform their decisions. Finally, a common cause of frustration had to do with their conversational capability. Stiff language and responsiveness limited to just simple keywords meant that this generation of chatbots was not able to hold natural flowing conversations with customers or understand any requests or prompts outside of what they were programmed to.

This resulted in customers’ inquiries and demands not being met, leaving the staff to resolve issues while dealing with frustrated customers.

Cognitive chatbots change the game

Thanks to cognitive technologies like AI and ML, as well as natural language programming (NLP), the functionalities of chatbots have changed dramatically. Chatbots are no longer defined by a narrow set of pre-programmed answers and limited data access, as their cognitive capabilities give them the edge their predecessors lacked – and this is only the beginning.

Modern chatbots are far more proactive and truly cognitive. They can learn from previous interactions and leverage backend data to personalise their engagement with the individual customer. Cognitive chatbots offer round-the-clock support and can even predict possible future enquiries based on the user’s history and engagement patterns. With ML technology, chatbots can not only gain new levels of flexibility and complete complex tasks, but also no longer need constant fine tuning from developers as they constantly learn through customer engagement.  By introducing a conversational user interface (UI) into the application, chatbots are able to hold human-like conversations that feel natural to customers. In addition, multilingual chatbots that are able to communicate in the customer’s preferred language can not only overcome linguistic and geographical constraints but also deliver a much more enjoyable user experience.

This is not to say that a chatbot as a customer services agent will make the position of human agents obsolete. On the contrary, cognitive chatbot deployments can empower customer agents as a big volume of customer queries will be dealt with without their input. This will enable the staff to take care of more pressing issues which require more time and attention and cut down costs.Cognitive chatbots are low maintenance, low cost but high value and efficiency. In other words, the ideal complement to retail banking.

Chatbots help banks stay ahead of competition

In a highly competitive sector like retail banking, customer retention is crucial and chatbots play a key role in delivering a competitive advantage. To stay ahead of the game, banks will have to offer high quality, fast and efficient customer service that considers the specific needs of each individual customer. Thankfully, cognitive technologies and the new generation of chatbots are here to help and banking institutions should make the most of them.

Wanda Rich

Wanda Rich has been the Editor-in-Chief of Global Banking & Finance Review since 2011, playing a pivotal role in shaping the publication’s content and direction. Under her leadership, the magazine has expanded its global reach and established itself as a trusted source of information and analysis across various financial sectors. She is known for conducting exclusive interviews with industry leaders and oversees the Global Banking & Finance Awards, which recognize innovation and leadership in finance. In addition to Global Banking & Finance Review, Wanda also serves as editor for numerous other platforms, including Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune.