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Covid-19 has catalysed financial services organisations to harness Artificial Intelligence (AI) to improve customer experience (CX), says a report published by the Capgemini Research Institute.
However, financial services firms’ implementation of AI at scale is the lowest across all industries, and where AI has been deployed, there are still some customer expectations that are not being met — with half of the customers saying they receive no value from AI-enabled interactions.
The report, titled, Smart Money: How to drive AI at scale to transform the financial services customer experience, revealed that the deployment of AI to improve the overall CX has grown significantly in the financial services industry in the past three years.
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Nine in ten (94 per cent) organisations say that improving customer experience is the key objective behind launching new AI-enabled initiatives.
Just over half of customers (51 per cent) have daily AI-enabled interactions (like talking to a chatbot) with banking and insurance firms. This becomes even more important as most customers (78 per cent) expect to increase touchless interactions as the Covid-19 crisis prolongs.
Financial services firms have already perceived the positive impact on their bottom line of implementing AI in customer-facing functions, including reduced cost of operations (13 per cent) and increased revenue per customer (10 per cent).
The report noted that financial services firms believe that improving CX is the key objective behind launching new AI-enabled initiatives. However, a clear disconnect is emerging as there are some customer expectations that are not yet being met. Almost half (49 per cent) of consumers rate the value they derive from AI-enabled digital touch points as non-existent or less than expected.
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AI shift in Covid times
A majority (78 per cent) of consumers expect to use touchless interactions more, through voice assistants, facial recognition, or apps, compared to just 61 per cent pre-Covid.
Covid-19 is also prompting a major behaviour shift by older consumers as contactless payments adoption has grown by 37 per cent in the 61-65-year age group, and a 33 per cent increase with those over 66.
The report further revealed that financial services firms have the lowest scaled implementation across all industries. Only 5 per cent of banks and 6 per cent of insurers have been able to deploy AI at scale across several touchpoint functions.
The biggest challenge is leadership and organisational resistance is driven by anxieties about the need for new skills and job loss fears (reported by 52 per cent of banking and 53 per cent of insurance).
The benefits of AI deployment
Even with the lower rate of AI implementation compared to other industries, financial services firms have realised significant benefits. They have reduced their cost of operations by 13 per cent and have increased revenue per customer by 10 per cent after deploying AI in customer-facing functions.
Banks and insurers have witnessed greater customer engagement with brands from deploying customer AI. Around one in five industry firms (25 per cent for banks and 19 per cent for insurers) have seen a 20-40 per cent increase in customer engagement.
Anirban Bose, CEO of Capgemini’s Financial Services and Group Executive Board member, said in a statement: “Financial services firms have much to gain from implementing AI in their customer interactions, and they have an opportunity to embrace AI to re-imagine the customer experience journey.”
He added: “Organisations need to focus on educating their customers and staff on what AI can do for them. It will take both investment and consumer trust to make the most of this powerful technology.”
In April and May this year, Capgemini surveyed 5,300 customers across 12 countries and 318 business leaders from large financial services organisations with at least $1 billion in 2019 annual revenue across a range of sectors and countries.
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