A bank roadmap for using AI to combat credit risk

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Artificial intelligence (AI) has long since moved from science fiction to reality, and reports of new applications from transportation to cybersecurity seem to be popping up every day. At the same time, this technology has received rather limited distribution in the banking sector. The latest PYMNTS research shows that things are changing – and fast.

More than three quarters of financial institutions (FIs), or 78 percent, have either recently invested in AI systems (21 percent) or plan to do so within the next 12 months (57 percent), in particular for optimization purposes. credit and loan operations. Importantly, it’s not just big financial institutions that prioritize AI anymore; 86 percent of mid-sized banks (with assets between $ 25 billion to $ 100 billion) plan to invest in technology, and 41 percent of them plan to do so within the next six months.

Artificial Intelligence In Focus: A Banking Technology Roadmap, cooperation with Brighterion, monitors the accelerated adoption of advanced learning technologies in the banking sector and examines what contributes to this. The guide is based on a survey of 100 financial leaders and research that PYMNTS has conducted since 2018 on the use of AI and other complex computing systems in banking, healthcare and other sectors.

In this compendium, we uncover the key findings of our research, explore some of the perceived barriers to AI adoption, and offer first-hand insights from bank executives who have integrated AI into their own organizations.

One of the most important takeaways from our latest study is the urgency with which financial institutions are now approaching AI and their broader innovation programs. The top three reasons financial institutions choose to invest in technology are to improve the speed and accuracy of transactions (approximately 90 percent of financial institutions) and responsiveness to existing customer needs (77 percent). This far outweighs longer-term goals such as tackling the ongoing digital transformation.

This drive to better meet customer requirements and expectations may help explain why AI has gained more rapidity over the past three years than any other computing system we’ve researched. The usefulness of AI in fraud detection and prevention may be well known, but it also enables banks to understand and respond to the circumstances and needs of their customers in real time and at the account level. These opportunities are especially valuable in today’s dynamic economic environment.

Diana Kaplinger, executive vice president of customer relationship management (CRM), intelligent automation and personalization for Truist, said the bank is already using AI to interact with customers and sees growth potential in areas such as lending and lending.

“This technology will be very helpful in improving accuracy and efficiency while simplifying customer interactions,” explained Kaplinger in a textbook case study. “The customer journey can be tailored, especially if the customer is an existing customer, so online or offline interactions are based on customer preferences and requirements.”

For more information and insights into the growing use of AI in banking, download the compendium.

About the allowance

Artificial Intelligence In Focus: A Banking Technology Roadmap report based on research and interviews in collaboration with Brighterion examining how banks are using artificial intelligence and other advanced computing systems to improve credit risk management and other aspects of their business.




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