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AI - A Game Changer for Millennial Banking

7 months ago by Luigi Muscat Filletti
Office Working

The Millennial generation are steering the direction of digital innovation in the ways through which organisations are designing their products and services to appeal to the expectations and needs of this broad demographic. The progress of the digital age has seen firms in the sectors of Banking and Finance shift to online and mobile platforms to cater for the fast-paced, on-the-go lifestyles lead by Millennials, and with exciting technology continuously in the making, banks and financial institutions aim towards achieving the ultimate user experience for their customers by acquiring the top talent in the sphere of Tech.

‘Therefore, the message is clear - whoever is offering the user the best financial solutions within an engaging and user-friendly mobile platform is leading the scene.’

The Millennial generation is one which is seen to value transparency and ease of use, disregarding any unnecessary complications, especially when it comes to a concern such as personal finance. Being able to access your monetary data and carry out financial tasks should not be a lengthy and complex process, and with this understood, Fintech companies set out to design and develop services which Millennials would appreciate and use with satisfaction, a task which banks must rest to sooner rather than later. With the introduction of Artificial Intelligence in Fintech, machine learning is being implemented now in Banking to provide users with financial advice based on their behavioural patterns when spending and saving. The abilities to carry out transactions, payments and other features also provides users with the convenience they crave.

‘The importance of creating an engaging and mobile-friendly presence should not be taken for granted, as the vast majority of Millennials are carrying out their internet banking tasks on mobile.’

The real insight is that Millennials are today more likely to consider non-traditional payment firms due to the ease of use and convenience of mobile presence. Therefore, the message is clear - whoever is offering the user the best financial solutions within an engaging and user-friendly mobile platform is leading the scene. This competition is being made more challenging as banks and financial institutions can now implement the evolving technology of AI to develop their digital strategies on desktop and primarily, on mobile. The importance of creating an engaging and mobile-friendly presence should not be taken for granted, as the vast majority of Millennials are carrying out their internet banking tasks on mobile. Even more so, this is being done via a mobile app, making it essential for banks and financial institutions to invest their efforts in designing and developing the best possible mobile app for their customers. That being said, career opportunities in software development will continue to grow in the financial services sector, meaning that professionals in Tech will become more in demand particularly in UX Design, Blockchain Development and AI.

So, How Can AI Enhance the Millennial User Experience?

Firstly, one must understand that AI makes use of machine learning technology to implement pattern recognition in data in order to offer a more in-depth analysis and thus generate clever solutions. AI in Sales, Marketing and CRM is becoming more interesting and fruitful by time due to the ability to engage with the user on a deeper, more meaningful level. One common example related to the Fintech scene would be that of financial forecasting, where AI predicts future financial results through the ability to learn patterns of previous financial affairs and market trends. This type of technology can thus allow a tailor-made, customer-centric approach for banks and financial institutions, as such technology can learn each user’s financial behaviour through spending habits, income and investments, thus providing suitable financial advice relevant to them. In the case of Millennials, this demographic is one which is highly engaged digitally, and with that in mind, mobile banking apps could keep this segment of users frequently updated on incoming or outgoing payments and other banking-related tasks through simple mobile notifications. This, however, should be kept subtle and relevant, as users should not be bothered by constant advertising but rather by important updates regarding their banking.

Another area which AI is continuously growing in is chatbots, with this technology providing quick, accurate and consistent information for users all within a non-judgemental nature, thus offering greater transparency and honesty. What is more is that such technology is proactive to provide users with suggestions on ongoing matters before an upcoming issue arises. With regards to Millennials in particular, this segment does not really enjoy the lengthy process of visiting a branch or calling customer support in aid of assistance. The ability to offer a straightforward and effective self-service for banking tasks is therefore a major step in the right direction. Embracing digital innovation, the development of chatbots allow customers to manage and organise their money more easily by simply asking a question and receiving the suitable answer.

‘The ability for a bank to display digital growth and ambition, encompassed by a strong customer-centric approach, shows leadership in a sector which has yet to impress digitally.’

Chatbots are programmed to answer certain questions in a specific way, however this technology uses machine learning to recognise frequently asked questions and answer them accordingly. This technology must be constantly developed by professionals in Tech to be able to cope with new and different questions too in order to form a more dynamic and flexible attitude when proving information to users. Furthermore, now with the introduction of voice assistance, technology is enabling users to experience online banking services through voice commands. This newly introduced medium is set to transform the conversational aspect of chatbots to one which makes use of speech to reply to users. To keep up to date with such cutting edge technology, banks must make sure they invest in the right expertise to develop the CUI (Conversational User Interface) to ensure an excellent overall experience for the user. Individuals with experience in Artificial Intelligence Development will become more in demand as banks adapt to the changing landscape of customer-centric strategies and thereby focus their attention towards maturing their digital presence and services.

Millennials have grown up witnessing the evolution of technology, therefore are accustomed to embracing digital innovation in all its forms. The ability for a bank to display digital growth and ambition, encompassed by a strong customer-centric approach, shows leadership in a sector which has yet to impress digitally. The capability for a bank to overcome the obstacles facing the banking industry means that it is ready to grow and innovate for a better banking future.

'Millennials have grown up witnessing the evolution of technology, therefore are accustomed to embracing digital innovation in all its forms.’

On the other hand, as one would expect, through such a concept would arise new concerns regarding cybersecurity. Banks would also need to focus on developing and maintaining a strong cybersecurity to ensure that users are indeed in contact with the bank’s chatbots and not with unknown individuals on the other end. AI is being utilised in cybersecurity as a means of detecting problematic issues before they becomes increasingly serious, noticing suspicious digital behaviour beforehand. New modes of authentication are also being put into place through speech, voice  and face recognition which further empowers the user’s security when accessing their accounts through mobile platforms. The flow of delicate and confidential information must be kept a top priority, as trust and transparency is a major factor in customer retention, even more so for Millennials. Recruitment opportunities in Tech for banks will also be directed towards professionals in Cybersecurity to make certain that the right procedures are being carried out for users’ financial and personal data to be safeguarded at all times.

In Conclusion

The powers of AI should be put into effect by banks to steer their customers into a more appealing user experience through great digitalised services. Along the likes of Blockchain technology, AI has countless possibilities to enhance the financial services sector, with both these technologies going hand in hand towards a better future for banking which must cater for the maturing Millennial population.