Voice AI set to transform how banks interact with customers

Voice bots, powered by natural language processing (NLP) and speech recognition tech, are rapidly gaining traction across the financial services sector. However, the industry has come a long way since the launch of AI-powered virtual assistants – such as Bank of America’s Erica, which has handled over a billion client interactions between 2016 and 2022.

AI-driven interactions are redefining digital banking, thanks to the rise of generative AI and adjacent technologies. Indeed, the sector has come a long way from the relatively simple pre-scripted chatbots and autoresponders of old. We’ve gone from limited chatbot capabilities to being able to have real and meaningful conversations with AI on virtually all aspects of personal finance.

Generative AI, while still a fairly nascent technology in terms of its adoption across financial services, is now powering real-time information retrieval where the vast majority of queries never even involve a human agent. Clients can now get accurate, contextual responses based on their past interactions and transaction histories, while cloned AI voices deliver personalized experiences that are increasingly hard to tell apart from the real thing.

A new frontier for digital banking… or an opportunity for cybercrime?

There’s no denying the potential customer experience improvements and productivity gains of voice-powered AI assistants in digital banking. However, while they allow financial institutions to scale their call center operations to practically any level of demand around the clock, and in the client’s preferred language, significant risks remain.

Much like their human counterparts. AI assistants must adhere to stringent regulatory requirements. However, unlike human advisors, AI systems often operate in a legal gray area regarding accountability for fraudulent or misleading financial advice.. It’s also important to remember that malicious actors are also using voice cloning software for fraudulent purposes, such as duping unsuspecting clients into taking a desired action.

There are many emerging use cases for voice AI in financial services, ranging from fraud mitigation to loan onboarding and servicing to financial service advisory. Customer support is perhaps the most well established use case, however, since it allows customers to deal with routine enquiries rapidly without having to wait in line for a human agent. On the other hand, deferring financial decision-making to AI comes with its own risks to the point it can undermine the inherently human role in broader economics and the delivery of financial services.

Fintechs can’t ignore voice AI, but neither should they rush into it

As is often the case with new technology, tech companies often feel compelled to rush into it out of a fear of missing out. The dramatic rise of AI-focused fintech products in recent years is proof to that. However, while voice AI can enhance accessibility and lead to more natural and efficient customer interactions, fintechs must put data privacy concerns and regulatory compliance at the heart of their products and services, rather than attempting to tack them on later as mere afterthoughts.