Over recent years, digital transformation in the banking industry has taken shape in leaps and bounds because of advancements in financial technology. Innovations in the digital core banking system have led to seamless integration of internet banking solutions for making a range of financial services virtually available at the convenience of the fingertips.
Users can access almost all services natively through their smartphones, but the switch from offline to online has replaced human interactions with vague FAQs. Here, conversational banking combines personalization and digital convenience, transforming the customer experience through solutions like WhatsApp banking, personal finance management, etc.
According to a study, banks will save around $447 billion by 2023 from Artificial Intelligence (AI), $199 billion of which will come from implementing conversational banking solutions. These solutions won’t be limited to text-based chatbots but will also facilitate customer onboarding strategies, human-intermediated chatbots, omnichannel finance management support, etc.
Let’s see the benefits of conversational banking and how its use cases extend beyond chatbots.
What is Conversational Banking?
Conversational banking is a type of digital banking that rekindles bank-customer interactions in real-time through text messaging, voice assistance, in-app video calls, and web portals for an unparalleled level of service. It uses Communications Platform-as-a-Service (CPaaS) with AI and Machine Learning (ML) to learn from customer interactions to provide tailored omnichannel support. Banks can identify the same types of repetitive interactions and automate them to free up human effort for atypical and urgent requests.
Why Should Banks Develop Conversational Banking Strategies?
- Multilingual Support: Natural Language Processing (NLP) and speech recognition enable customers to interact in their native language.
- Hybrid and Omnichannel Experience: The cloud native CPaaS platform allows chatbots and human agents to be available on every channel for increased touchpoints.
- 24*7 Service with No Waiting Time: ML with Interactive Voice Response (IVR) can solve recurring queries through automated prompts at any time of the day.
- Build Customer Loyalty: Personalized and effective communication over all mediums enhances the customer’s journey, leading to higher customer satisfaction and trust.
- Lower Operating Costs: Conversational AI can serve thousands of customers simultaneously with high query resolution rates, increasing ROI with minimal human intervention.
Use Cases of Conversational Banking beyond Chatbots
WhatsApp Banking
WhatsApp banking is gaining traction as it makes banking as easy as chatting with a friend on a messaging platform. Digital core banking systems and national payment switch allow seamless integration of banking services with the WhatsApp messaging platform.
It lets banks interact with customers on the go and deliver first-rate customer engagement and quick services in a well-secured environment. Some functions include funds transfer, check book requests, pre-approved loan inquiries, push notifications, mini statements, card blocking, and credit/debit card applications.
Customer Onboarding
Getting off on the right foot while establishing relationships with new banking customers is important. Delivering a memorable customer experience with a personal touch from day one can hugely impact customer lifetime value (CLV).
Banks can use in-app video calling for digital customer onboarding to:
- provide face-to-face access to representatives giving real-time assistance
- engage customers by offering live product demos
- learn customers’ individual needs and preferences
Monitoring for Fraudulent Activity
Conversational AI can generate daily, weekly, or monthly spending reports so that customers can promptly address any unrecognized banking activity. It can also monitor and report any suspicious activity and suggest actions, such as locking cards, resetting the password, and checking bank statements in a flash.
Conversational AI can notify customers and redirect them to the correct live agent to fix the issue in cases of phishing attacks, hacking, unauthorized access, or deduction.
Personal Finance Management (PFM)
Conversational banking can make it simple to access PFM tools for customers looking to manage their money on the go. It keeps them well-informed about their spending habits with the help of data collected from various sources and regular customer monitoring.
Conversational AI can be an effective medium for offering financial insights and advisory. For example, customers can ask and know how quickly they can purchase a new car over their preferred communication channel.
Smart Payment Processing
Smart payment processing involves collecting individual data to speed up payment processes. Chatbots, mobile applications, and internet banking solutions can help remind customers of due payments, bills, EMIs, etc.
It eliminates the redundancy of entering details repetitively. For example, customers can initiate the transfer through chat on the banking app using biometric validation instead of logging into the net banking portal and entering credentials for fund transfers.
Customer Feedback
Feedback and reviews from customers are imperative to making service improvements. Customers will probably skip formal and outdated methods, like lengthy surveys and static feedback forms.
Conversational AI can bring a fun, interactive, and casual approach to taking feedback. Banks can implement friendly UI to boost customer experience (CX) and improve customer satisfaction (CSAT) scores.
Applying for New Services, Products, and Loans
Conversational banking enables customers with active accounts to start conversations on the bank’s website or app to inquire about new products and services. Banks can display offer simulation in the chat, whether it’s loan applications, new credit cards, or redeeming offers.
The banking system can calculate models and generate necessary documents through data integration, so customers don’t need to speak with representatives in person. Conversational AI can direct its effort toward users’ intentions to help them choose the best product for their needs and generate leads more effectively.
Quick Location-based Information
People often travel and expect their banks to answer their queries based on their location. Banks can leverage GPS on users’ smartphones to help them find the nearest ATM or branch. In addition, banks can reach out to their users via different channels with geographical directions and other location-based services and offers like travel insurance at the airport and discount coupons for specific restaurants.
Reach the Next Level of Convenience: It’s Time to Get Conversational
Banks must not depend on just text-based chatbots that answer frequently asked questions to improve customer experience, customer lifetime value, and net promoter score. AI-powered conversational banking with human-intermediated chatbots and IVR will be pivotal for banks to retain a competitive edge.
Panamax’s Banking Suite comprising a digital core banking system, national payment switch, omnichannel, and WhatsApp banking solutions takes convenience and security to the next level.
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WhatsApp Banking – Making Banking Accessible
Staircase to Success: Redefining Customer Experience in Banking
