In the evolving world of financial services, where rapid adaptation to customer needs is paramount, generative AI (genAI) is quickly becoming a game-changer. Its prowess in generating customised content and solutions is redefining how financial institutions interact with their customers and optimises their internal operations.
That’s according to analysts at GlobalData with Kiran Raj, Practice Head of Disruptive Tech at GlobalData, stating: “With the growing demand for personalised financial solutions, genAI has a pivotal role in curating bespoke customer experiences. It is not about generic financial products anymore but crafting individualized strategies that align with each customer’s financial goals.”
Saurabh Daga, Associate Project Manager of Disruptive Tech at GlobalData, added: “Harnessing the power of genAI to analyze intricate patterns in transaction histories and financial behaviors can create predictive models that not only anticipate customer needs but also craft targeted financial products and advisories. This has the potential to elevate customer service, optimize costs, and enhance overall user satisfaction.”
Diving deeper into the transformative potential of genAI, GlobalData’s latest Innovation Radar report, “Code to capital: generative AI meets financial services,” showcases the broad spectrum of genAI applications. From risk assessment and personalized advisory to cognitive customer care and fraud detection, the breadth of genAI’s impact is profound.
Traditional banks such as JPMorgan and HSBC have already developed genAI-based tools that offer personalized financial advice to their customers.
On the other hand, emerging fintechs such as Stripe and Cowbell are enhancing their end-user experience with genAI-powered tools.
Synthetic data is being used by financial service providers such as Provinzial Insurance and Wells Fargo to create predictive models to detect fraud as well as develop personalized offerings.
Deutsche Bank and Goldman Sachs are experimenting with genAI to automate some of their backend processes including banking software development and management of financial documents.
Daga concluded: “Implementing genAI in the sensitive landscape of financial services comes with its set of challenges. Issues surrounding data accuracy, ethical considerations, and privacy are paramount. However, with judicious governance, these hurdles can be surpassed. Forging strategic alliances can be a pathway to harness the transformative potential of genAI, ensuring they are equipped with the right technology, infrastructure, and talent to capitalize on this wave of innovation.”