Banking

The Definitive Guide to Conversational Banking

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Introduction To Conversational Banking

Covid and evolving markets have empowered customers to make demands from businesses and this extends to banks as well. Services like Netflix, Amazon, and Spotify have transformed the meaning of the word ”customer experience”. And then there is Amazon Echo/Dot with Alexa, Google Home with Google Assistant, and Apple with Siri. All these virtual assistants have raised the bar across all industries, and businesses today are striving to meet the growing demands.

According to a Forrester report, 87%of businesses are aware that the typical banking experience is insufficient to keep customers happy nowadays. The quest for a better experience in the digital age has led to the development of conversational tools playing a major role across industries. Before we go any further, let us first understand what is the future of banking and the role played by Conversational Banking.

Conversational banking is better interaction with customers through various means of communication. It is not just limited to text and voice chat. The main objective for any business, including banks, is to get a deeper understanding of what their customers want and match their expectations. Conversational banking aims to forge relationships with customers by fostering trust through dialogue and streamlining the purchasing process.

Conversational banking is

  • Personalized
  • Streamlined & Seamless
  • Real-time
  • Relevant
  • Consistent

The goal of conversational banking is to forge relationships with customers by fostering trust through deep dialogue and streamlining the purchasing process.

Related article: The Role of Generative AI in Loan Origination System

Hyperautomation in Conversational Banking

One of the emerging trends in conversational banking is the integration of hyperautomation. Hyperautomation refers to the use of advanced technologies, such as artificial intelligence (AI), machine learning (ML), robotic process automation (RPA), and natural language processing (NLP), to automate and streamline business processes.

Hyperautomation plays a crucial role in enhancing the capabilities of conversational banking by enabling more efficient and personalized customer interactions. Here’s how hyperautomation can be applied in conversational banking:

1. Intelligent Chatbots:

Hyperautomation enables the development of intelligent chatbots that can understand and respond to customer queries in a more sophisticated manner. These chatbots can leverage AI and NLP technologies to interpret customer intent, provide accurate information, and offer personalized recommendations.

2. Advanced Analytics:

Hyperautomation facilitates the collection and analysis of large amounts of customer data in real-time. By applying ML algorithms to this data, banks can gain valuable insights into customer behavior, preferences, and needs. These insights can be used to deliver more targeted and personalized conversational banking experiences.

3. Process Automation:

Hyperautomation can automate repetitive and manual tasks within banking processes, such as account opening, loan applications, and account maintenance. By integrating RPA into conversational banking systems, banks can streamline these processes, reduce errors, and improve operational efficiency.

4. Seamless Integration:

Hyperautomation allows for seamless integration of conversational banking across various channels and touchpoints. Banks can leverage technologies like APIs and microservices to connect chatbots, voice assistants, and other conversational tools with existing banking systems, providing customers with a consistent and seamless experience.

5. Enhanced Security:

With the rise of digital interactions in conversational banking, ensuring the security of customer data is of paramount importance. Hyperautomation can help banks implement robust security measures, such as biometric authentication, encryption, and fraud detection algorithms, to protect customer information and transactions.

By incorporating hyperautomation into conversational banking, banks can not only meet the growing demands of customers but also achieve operational excellence and competitive advantage. The automation of processes, advanced analytics, and seamless integration capabilities provided by hyperautomation enable banks to deliver personalized, real-time, and efficient conversational banking experiences to their customers.

How Does Conversational Banking Work?

According to research by Digital Banking Report, 75% of financial institutions thought about leveraging conversation AI, data, and analytics to choose the best course of action. Therefore, banks must employ technology as efficiently as possible by utilizing Machine Learning (ML) and Artificial Intelligence (AI) to enhance the client experience.

Digital banking utilizing voice, text messaging services, or visual engagement technologies is referred to as conversational banking. It implies that you can use messaging apps to communicate with the bank directly. Additionally, conversational banking allows financial institutions access to vital information about the intentions, ambitions, and financial behavior of their clients, allowing them to cross-sell products and services and provide pertinent guidance.

Conversational Banking can be initiated in real-time using conversational tools such as Artificial Intelligence [AI] chatbots, Virtual assistants, and voice assistants.

Related article: Conversational AI in banking in an era of social distancing

Benefits Of Conversational Banking

Customers today expect solutions within a few minutes, they are no longer willing to wait. From the very screen you are reading this post, you can open another tab and check your bank balance, credit score, shop for your home and even pay your bills.

Conversational tools therefore enable real-time updates, omnichannel presence & interaction, better lead generation and conversations that capture customer data through websites or social media channels. Subsequently, this improves operational efficiency and optimizes business cost through better utilization of resources and faster turnaround time for queries raised by customers, resolved instantly by banking chatbots.

Benefits for Customers

~ 24×7 availability – Customers don’t have to wait for a response to their query because of our 24-hour availability. The usual financial questions that customers ask can be handled by chatbots for banking that are available round-the-clock.

~ High-quality service — The error is identified faster and a viable solution is offered with the aid of digital engagement tools. The number of touchpoints is lowered, and first contact resolution is enhanced.

~ Proactive customer interaction – When clients need a solution right away, proactive outreach enables them to find it. This boosts brand loyalty and client happiness.

Benefits for Banks

~ Cost optimization – Chatbots can efficiently handle frequent client inquiries, which lowers operational expenses. Businesses spend close to $1.3 trillion fulfilling these requests, and using bots can help you cut costs by up to 30%.

~ Fewer Errors – Errors that occur during manual work run the danger of becoming major issues in the future. Conversational banking provides flawless service and prevents issues. AI chatbots, for instance, are programmed with all the information, thus errors are impossible.

~ Scalability – Chatbots are simple to scale up or down during busy banking hours or unexpected increases in consumer demand. They can handle large volumes of queries/chats without having an impact on the costs of the company.This is the highlight of integrating chatbots in the banking sector.

~ Resource allocation – With the help of conversational banking tools, automation of repetitive tasks is taken care of and therefore resources are freed up for other important tasks.

~ Better lead management – Chatbots are a good way to capture leads. A chatbot has access to numerous client touchpoints along the omnichannel purchasing journey, unlike a human salesman. Additionally, chatbots are equipped with a database of client insights that may be processed very quickly. They are thus ideally adapted to the job of sifting through the sales funnel a huge number of potential clients.

Related article: 11 Important Banking Processes to Automate with Workflow Management Software in 2022

Importance Of Conversational Banking

Analytics Insight has predicted that the Global Artificial Intelligence market revenue in the banking sector will touch a whopping USD 48.3 billion by 2025. Conversational banking addresses one of the biggest challenges that banks continue to face:

  • Difficulty in retaining & engaging with customers
  • High cost of Customer acquisition
  • Meeting the growing expectations of customers
  • Technology involved to boost connectivity and convenience is constantly evolving
  • Stiff Competition [from fintech, insurtech and neobanks]
  • Regulatory compliance is complex & time-consuming.

Related article: Increase Banking CSAT with Conversational AI Chatbots in 2023

Conversational Banking Use Cases

Here are just a few Conversational Banking based use cases where they can improve client experiences by utilizing conversational banking.

Transform interactions into transactions

Automate inquiries concerning transfer restrictions, recurring charges, bonus points, and expenses. Transform straightforward transactions into practical, pleasurable encounters. Customers are more inclined to suggest a bank to relatives and friends if they consistently like using it.

Auto-send notifications & reminders

Reminding customers of payment due dates and financial procedures will ease their minds. Inform clients of modifications to their credit ratings or pertinent news.

Automating FAQs

Help consumers discover ATMs, check interest rates, check bank balances, and much more. Provide consumers with the information they require, at the precise time they require it, by responding to questions concerning credit or loan applications. Banks that use Hubtype typically automate 80% of their total queries.

Track and meet SLAs (service level agreements)

Utilize intelligent automation to surpass performance thresholds. Cut first response times (FRTs) and, if necessary, escalate discussions to human agents.

In-App Live Chat

A seamless and simple customer experience is made possible by the opportunity to message a customer service staff directly. Real-time messaging between customers and agents is possible. In contrast to interacting with a chatbot, this adds a personal touch to the conversation and usually makes the customer feel better understood. Because it fosters a client-centric environment that supports the bank’s ultimate goal of retention, live customer service benefits the bank. Live, in-app chat is typically used to explore more complex banking issues or to ask questions about upgrading accounts.

Examples of Conversational Banking

Self learning AI chatbots across several larger banking institutions have proved to be especially helpful. When a consumer interacts with this proactive virtual assistant, it first ascertains their individual issue and either offers a solution or refers them to the proper support personnel. Additionally, it can offer interactions in many languages, geographical directions, and other location-based services.

Conversational IVR prioritizes urgent situations and immediately handles customer complaints. Customers typically had to wait over 2.4 minutes on the phone before speaking to a live customer service representative. Customers can only begin to articulate their problems after waiting for such a long time. Customers can use MindTitan’s Conversational IVR to ask questions in their own language and receive answers automatically without the help of a human agent by using only the most cutting-edge speech recognition software and machine learning technology.

Key Considerations When Choosing Conversational Banking

The future trend is clear: in order to compete with fintech, the legacy banking sector must incorporate Conversational Banking solutions to give customers a better experience. Costs are decreased, customer satisfaction and loyalty are dramatically increased, and human errors brought on by emotional states of mind are eliminated when using AI-powered Conversational IVR and chatbots. Making the process work could be difficult, so picking the proper technology partner is essential.

Questions to ask yourself before choosing a conversational banking tool/solution are:

  • What is your business objective for the next 5years?
  • How effective are your digital strategies?
  • Can a new AI/ML capability be integrated into your existing system?
  • Are your processes streamlined ?
  • How important is customer experience to your business?

Once you get answers to these questions, make a list of available conversational banking solutions providers and look for one that matches your requirements. Banks and others in the Financial services space can develop a flexible and personalized service that boosts the chances of forging successful relationships with consumers by utilizing those digital technologies that prioritize interaction.

How To Develop A Conversational Banking Experience In Your Bank?

Map your customer journey

Creating a map of your ideal customer’s journey and identifying the most frequent queries/challenges that are likely to come up at each phase is the first step in building your conversational banking experience. From this exercise, it becomes clear where the client needs help and where chatbots can help speed up processes and reduce fraud and errors as well.

Related article: What is Customer Journey Analytics? & Why is it Important?

Chalk out areas that require human intervention

Pay attention to your message, mobile, and various social media channels. Move through your customer experience as if you were a brand-new visitor to identify areas where human intervention will help tide over the challenges.

Customer data security

When designing a conversational banking experience, security and data protection should be front of mind because banking is a highly regulated sector. Meeting compliance standards is important due to the sensitive nature of the information communicated in these environments, which makes them a target for security attacks. Gaining and keeping customers’ trust is the whole idea of a conversational banking experience; data breaches can undo all trust-building efforts that came before them.

Measure Success Across Channels

Designing a conversational banking experience is complete only when you have a performance assessment metric in place. Prior to execution, setting goals for your new banking strategy is crucial. Then, when a sizable amount of time has passed, you can compare the client data gathered with the reference metrics. Through internal surveys, one can do the same for comments and experiences from employees.

Here are some potential trends and developments that could shape conversational banking in 2023

Improved NLP and AI

As NLP and AI technologies continue to advance, conversational banking will likely become more sophisticated and accurate. This could lead to a better understanding of customer requests, more personalized responses, and the ability to handle more complex queries.

Integration with more channels

In 2023, we can expect to see conversational banking being integrated with more channels beyond messaging apps and chatbots. Voice assistants, social media platforms, and even augmented reality (AR), and virtual reality (VR) interfaces could be incorporated to provide a seamless and personalized banking experience.

Enhanced security features

As the use of conversational banking becomes more widespread, there may be a greater emphasis on ensuring the security of customer data and transactions. This could include the use of biometric authentication, encryption, and secure data transfer protocols.

More personalized customer experiences

Conversational banking can provide a more personalized experience to customers by offering customized product recommendations, personalized financial advice, and tailored marketing messages. In 2023, we can expect to see more banks offering personalized services through conversational interfaces.

Increased automation

With the help of conversational banking, banks can automate many customer interactions, such as account balance inquiries, payment requests, and loan applications. In 2023, we can expect to see even more banking functions being automated through conversational interfaces, which can help to reduce costs and improve efficiency.

Overall, conversational banking is a rapidly evolving field, and we expect continued growth and innovation in the years ahead. As technology improves, conversational banking has the potential to transform the way we interact with banks and manage our finances.

Conversational Banking with Autonom8

“Only mobile banking” is fast becoming the way of business, and this includes banks as well. Social media is enabling banks to interact in new ways. A wide range of chances in consumer banking is made possible by all these various opportunities.

Our goal at Autonom8 is to strengthen client interactions by providing digital banking solutions. We are a multi-experience development business that provides omnichannel platforms for low-code banking solutions.

At Autonom8, we have been helping banks accelerate their digital transformation journey by incorporating conversational banking tools and solutions into their system. One of the elements we offer is the A8Chat. The platform was customized to deliver multiple workflows customized for product needs. Completely digital with documents captured via images or document upload. Agile to accommodate field and business level changes within 8-16 hours. You will see 4x reduction in the overall cycle time, along with a 50% boost in efficiency. Talk to us today to transform your business.

Remember, Conversational banking techniques are the cornerstone of effective customer care, whether it is chatbots that provide information on mortgages or co-browsing to work on applications with customers.

Related article: Build Mobile Banking Apps Fast and Right with Autonom8

FAQs on Conversational Banking

What is conversational banking?

Conversational banking is a solution that uses machine learning (ML) and artificial intelligence (AI) to speak with customers. Reducing the amount of steps a consumer needs to take to accomplish a task is the ultimate goal of conversational banking, which also aims to improve UX.

What are chatbots in banking?

Chatbots and virtual assistants are what helps businesses improve their customer engagement and lead generation. In Banks, Chatbots can help resolve queries instantly, automate repetitive tasks, offer personalized services,cut down costs [ no need to hire additional resources to handle customer queries], improve overall efficiency and allow existing resources to focus on high priority tasks and activities.

How can AI be used in banking?

By using AI capabilities, banks can predict future outcomes and trends along with gaining insights into customer behaviour. AI can be used to process the data gathered from customers to understand their preferences and challenges. This helps banks in detecting anti-money laundering patterns, identifying fraud, and providing informed suggestions and alternatives to customers.

How conversational AI is transforming the banking industry?

With the help of chatbots, funds transferred, credit investigation requests, credit card orders, insurance contracts, or account balances can be quickly retrieved without having to physically contact a bank. AI helps speed up tasks that are repetitive in nature, it also allows for instant clarification or processing whenever a customer has a requirement. SImilarly, it helps banks stay ahead of the competition.

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