Bots and Biometrics for Financial Services: Putting the “B” in Banking
Today, nearly every financial process has been digitally redefined.
- 94% of customers now use their smartphones to check account balances and recent transactions
- Over 60% of customers would consider storing key documents in a “virtual vault”
- Overall, nearly two-thirds of customers globally are using FinTech products or services.
For financial service providers (FSPs), digital transformation has become a means of survival in an age of rapid innovation. There are many ways FSPs can digitize. But for driving revenue and competitiveness, there are two forms of digital engagement that must be considered: chat bots and biometrics.
The Beginning of a Bot-filled World
Chat bots are at the center of the digital banking revolution. We’ve rapidly evolved from the days of ELIZA and A.L.I.C.E. to a world where anyone, anywhere can easily create virtual, conversational agents that drive specific user experiences. Consider that 34,000 chat bots were developed using Facebook DeepText (the company’s new AI) within the first six months of its release. Overall, 2 billion Facebook messages are sent each month, and over 50% of users say they’re more likely to do business with an organization that can conversationally message.
To this end, we’re seeing several market leaders developing dynamic bots. For example, Bank of America is currently testing its highly-anticipated chat bot, Erica. They are taking the time to refine the solution’s AI engine to ensure it provides contextual value and anticipatory engagement. MasterCard is also piloting a new chat bot—Mastercard KAI—on Facebook Messenger. In addition to conversational messaging, the bot delivers personalized offers via integration with the company’s “Priceless” experiences initiative.
This chatbot ecosystem is only expected to further grow as the technology sophisticates. As it does, FSPs will be able to effortlessly automate processes like fraud detection, fund transfers, insurance comparisons, payment processing and more. As they do, they’ll be able to reduce costs by up to 80% and time to perform tasks by up to 90%, not to mention the benefits and value of the customer satisfaction they will drive.
The Potential of Biometrics for Banking
The future of identity in banking can be summed up in one word: biometrics. While not yet commonplace, we’re seeing major players now leveraging physical characteristics (fingerprint, voice/face, keystroke) to support automated recognition.
Consider Apple’s 2012 acquisition of mobile security company, AuthenTec, a move that undoubtedly set the stage for its 2014 rollout of Touch ID and Apple Pay. Just two years later, Apple Pay now leads the mobile payment market with over 12 million monthly users. In the Middle East, Emirates NBD Bank has also implemented a biometrics log-in capability that lets customers use a form of Touch ID on its mobile app to securely log into all accounts.
Biometrics represents an important step in FSPs’ digital transformation plans. Nearly 90% of customers believe their banks do enough to protect their mobile apps, yet 41% still expect those apps to be hacked. As such, nearly 80% of customers would be willing to use voice biometrics if it meant tighter security. Overall, the global biometrics market is expected to reach $17 billion by the end of this year, having grown at an incredible CAGR of 18.5% over the last seven years.
Early Adoption for Massive Profit
Chat bots and biometrics represent unparalleled opportunity for FSPs. More key players are legitimizing these technologies with significant investments, yet many FSPs have yet to adopt them to a significant degree. Now more than ever, these technologies are ripe for investment to curtail costs, minimize security threats, and reimagine the user experience.
Successfully adopting these technologies, however, requires a fully-baked strategy with support from the right partner. To learn more about the “how” of chat bots and biometrics for financial services, browse this resource guide from Avaya.