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Increase Banking CSAT with Conversational AI Chatbots in 2023

Aarti Krishnakumar

Dec 01 2022
How Banks and Credit Unions are Using Conversational AI Chatbots to Increase CSAT

Introduction to Conversational AI Chatbots

Modern customer involvement requires business owners and entrepreneurs to offer their current or potential customers timely solutions. Understanding the reasons behind low customer satisfaction levels [CSAT] is crucial for banking firms. To increase CSAT, the banking sector needs to find a technical solution. Conversational banking is one option among the ones offered that can raise client satisfaction levels. When customers want to communicate and solve their problems, they expect human-like intelligent discussions; they want to be heard wherever and whenever they need it. Clients can use conversational AI in banking without human participation or support to complete daily banking tasks.

As a result, chatbot technology has become widely used, arguably more so than at any time since it first achieved notoriety. 40% of firms cited Customer Experience (CX) as their primary driver for deploying AI technology, according to Gartner. However, chatbots by themselves need to be adequate. Businesses are moving away from conventional, totally automated, and “dry” encounters and toward conversational AI solutions.

Conversational AI is not the same thing as chatbots. However, that does not imply that they are unrelated. Unfortunately, the terminologies are frequently used interchangeably, leading to confusion. 

What is CSAT? 

CSAT gauges how well a customer’s expectations for a company’s good or service have been met, missed the mark, or exceeded.

What distinguishes conversational AI from chatbots, then?

Computer programs or devices that can “chat” with you [online] are called chatbots. Some chatbots have robotic appearances. The AI technological tools that enable conversational interactions with computers are conversational AI (or conversational artificial intelligence).

In other words, it alludes to various AI technologies employed to make it possible for computers to communicate “intelligently” with one another. They use technologies such as Natural Language Processing [NLP], Machine Learning [ML], Deep learning, Intelligent predictive analysis, and conversational AI power chatbots.

How do conversational AI Chatbots work?

According to The Fintech Times, the number of midsize banks and credit unions using chatbots tripled in just one year in 2021. Use increased from 4% to 13%. Analysts predicted that usage might have doubled by the end of the previous year.

Artificial intelligence (AI) technologies have an ever-greater impact on our lives, from quick translation to conversational interfaces. This is especially true in the financial services industry, where adversaries have already introduced innovative AI-driven products. If completely integrated, these capabilities can dramatically increase client engagement by supporting their economic activities across various online and offline settings with intelligent, highly tailored solutions offered through an easy-to-use interface. These are the fundamental criteria for an AI bank.

Using Alexa, one can ask, “When is my next monthly loan due?” or ask Siri, “What was the last payment made on the credit card?”. Virtual assistants have made life easy, and customers now demand the same level of service from their banks. Amazon Echo/Dot has Alexa, Google Home has Google Assistant, and Apple has Siri. Ask them a question; voila, you get options to choose from within a second. Banks and credit unions can automate up to 60% of business transactions by implementing intelligent virtual assistants [IVA] while engaging members through natural conversation and providing individualized self-service alternatives.

How does Conversational AI help banks improve CSAT?

Faster query resolution

In 2020, customers had to wait 3 hours to speak with a human representative when phoning their bank, which led to losing business and customers. The pandemic highlighted the importance of conversational AI and how it could turn things around.

As conversational AI improves understanding of human input, it is simpler for users to communicate with gadgets and software. Users will only need to write as many words or in the appropriate order to be understood and have their questions answered.

Unlike a conventional chatbot, a conversational AI assistant deals with more sophisticated and complex interactions and provides clients with answers to their questions and problems more quickly and effectively.

Time is significantly reduced by this more rapid and precise query resolution. It also helped optimize the cost and utilization of available resources. 

Personalized follow-ups and recommendations

Conversational AI integrates customer data from the business to fully understand the customer journey. Through predictive analysis, it makes personalized recommendations and responses using this data to analyze client behavior, spending patterns, and the products they are most interested in.

Direct promotions are less effective for banks than this type of cross-promotion of goods and services through targeted, hyper-personalized recommendations.

AI assists banks in ensuring quality and consistent customer experience across all channels and touchpoints to a greater extent. The more effectively it feeds on data quality and advances its knowledge.

Improved customer experience

Client pleasure and experience are greatly enhanced when conversational assistant AI uses Natural Language Processing (NLP) to examine customer input or queries and provide the best possible response.

It gives clients the sense that they have been heard, which is crucial for call centers and the banking sector.

AI predicts what the client could require next based on previous encounters and talks, making it simpler to follow shifts in context with a natural, fluid conversation.

For instance, imagine a consumer raises a question in the middle of a discussion. In that situation, AI responds to and answers the question, providing pertinent data and bringing up the initial query.

Related article: The Definitive Guide to Conversational Banking

Benefits of Conversational AI Chatbots in Banking

Superior experience in design can produce a lot of value. According to a McKinsey survey of US retail banking customers, deposits grew 84 percent faster at banks with the highest reported customer satisfaction levels than at banks with the lowest satisfaction levels.

  1. Better lead management 
  2. Strengthen customer engagement 
  3. Round-the-clock efficient service
  4. Connect & interact across channels
  5. Better privacy & security 
  6. Personalization
  7. Real-time metrics 
  8. Reduce customer service cost 
  9. Streamlined processes
  10. Automated fraud detection

Different kinds of Banking Conversational AI Chatbots 

Banks and credit unions integrate chatbots into their websites and mobile apps. A user can ask the Chatbot for assistance or accept its offer by clicking or tapping on the icon. Which program is most effective depends on the needs of the customers the bank intends to meet.

(1) The most commonly used form of Chatbot is the Rules-based Chatbot

Chatbots, in this case, follow a simple flowchart to replicate discussions using rules. The Chatbot occasionally poses questions and offers consumers a few options during a conversation. The flow chart shows how the dialogue changes depending on the user’s response. The clients will find the information or page they’re seeking when the Chatbot takes all the right turns based on their responses.

The correctness of the chart determines how effective a rules-based chatbot is. Computer scientists sometimes call these programs “set guidelines chatbots” or “basic chatbots.”

(2) The other kind are the Menu chatbots

Menu chatbots give the user options in the form of a menu or buttons. Frequently asked questions like “How do I find my routing number?” may be presented as buttons on a banking menu Chatbot. Another option is to provide information in categories like “account security” or “open an account” on a menu.

Lack of intuitive classification and language difficulties are two issues with menu chatbots. Due to language-based problems, a consumer may need help to interact with the Chatbot. Even if the customer knew what he was looking for, the menu might be closed if the Chatbot used strange phrases or different language.

(3) AI Chatbots

AI chatbots are much more advanced than chatbots with a “flowchart” design. Chatbots can be trained by scientists using machine learning, and massive datasets use to train chatbots to comprehend relevant facts and human speech.

Chatbots can train to comprehend the query’s context and the definitions of the terms used in it. It also gives chatbots ways to give users access to their data securely. While training increases the sophistication and realism of a chatbot, it is also costly. For banks, the return on investment can occasionally be worthwhile, significantly if it increases customer acquisition.

Some of the other lesser-known chatbots are – Contextual Chatbots, Keyword based Chatbots, Voice-based chatbots, and Hybrid Chatbots.

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

How to implement Conversational AI Chatbots in Banking and Credit Unions

Steps involved in implementing Conversational AI chatbots:

1. Problem Identification – What problem are you trying to solve? Why do you need a Conversational AI chatbot?

2. Define the goal – Is the objective to reduce response time? Generate more leads? What would a successful implementation look like? Define the KPIs and metrics.

3. Choosing the exemplary Chatbot architecture – Are you looking to hire a team to implement the chatbots? Would you prefer to work with a low-code platform?

4. Give your Chatbot a personality – Create a persona for the Chatbot. They are going to be the face of your business. How do you want them to greet/interact with the customers?

5. Trial, Monitor & Measure – Before going Live with the chatbots, understand what your customers are looking for. Map their behavior to the algorithm. 

Examples of Conversational AI Chatbots in Banks and Credit Unions

Automate your crucial banking functions.

Conversational AI gives your customers agency over the process via a friendly, self-service interface without requiring them to interact with a human operator unless they choose to, whether it be for opening a new account, reporting a lost card, checking account balance, processing mortgage payments, or any other core banking services.

Quick and individualized service

Deliver prompt, precise, and consistent responses to inquiries about the goods and services offered by your bank to lower barriers to customer service and support. Robust integrations like user authentication can enable proactive and customized responses that cater to specific consumers’ demands and get better over time, owing to self-learning AI.

Case studies of Conversational AI Chatbots in Banks and Credit Unions 

An emerging fintech company wanted to outsource its technology while concentrating on sales and credit. The top considerations were the rapid product variant rollout and building a distinction around quick payments.

Autonom8’s Conversational Banking Solution:

The platform was modified to deliver several workflows tailored to the product’s needs. Purely digital, capturing documents using image capture or document upload

Delivery in 15 business days

Agile to adapt to changes at the field and organizational levels in 8–16 hours

Absence of client IT involvement other than integration with their back-end systems

Sales efficiency is higher by ~25%, with back-office productivity up by ~45% (compared with similar products from the competition)

The client saw a 4X reduction in the sales cycle, a 50% increase in efficiency, and a 15% better customer experience! 

Read more Autonom8 case studies

Autonom8’s conversational banking platform trial to increase CSAT

Texting and chatbot services are the preferred means of communication for many clients. 

An efficient, innovative conversion tool, conversational AI assists banks in the following ways: 

(a) Offer support for submitting applications for various banking goods and services conversationally.

(b) Sends customized advice and recommendations, providing prompt assistance and avoiding client churn.

This improved customer experience boosts bank conversion rates, benefiting the banking business. Banks and credit unions can increase productivity through automation, offer highly personalized customer experiences, provide the highest security available, and generate new revenue streams with the help of Autonom8’s range of digital solutions. A8Chat is an AI-powered, enterprise-grade Virtual Assistant that can learn, adapt, and evolve based on the growing needs of your employees and your IT Helpdesk. Visit Autonom8 for more information on how our solutions can help transform your CSAT. 

FAQs on using Conversational AI Chatbots to Increase CSAT

What are conversational AI Chatbots?

Conversational AI Chatbots offer instant connection and response, leading to better customer engagement and relationships. For example, when you visit a website, you will see a small button or icon at the bottom. When clicked, it opens a chat box using which the visitor can chat with a chatbot to clarify queries or obtain inputs to help them make informed decisions about the product/service offered by the company.

How conversational can AI chatbots be used in banking?

Through the chat interface, customers can engage with a variety of conversational AI banking operations, including reporting possible fraud on their banking cards, requesting an increase in their credit card limit, and obtaining a breakdown of recent transactions.

How conversational are AI chatbots transforming the banking industry?

Voice bots or IVRs (Interactive Voice Responses) are becoming more and more common in customer support, even in the banking industry, thanks to the increased popularity of Amazon's Alexa and Google's Home Assistant. By implementing conversational banking chatbots, financial institutions guarantee a smooth, contemporary customer experience with self-serve and instant query resolution capabilities and lay the groundwork for future customer engagement.