AI in banking: TOP use cases and examples

Summary

In this video by Jelvix, the unexpected prominence of AI in banking is explored, debunking any preconceived notions that the financial sector is behind in AI adoption. AI's growing use in the industry is demonstrated through numerous real-world cases from leading financial institutions. Key points include JP Morgan's use of AI for payment validation, HSBC's integration of AI in anti-money laundering efforts, and Barclays' AI-driven customer service enhancements. The video underscores AI's significant role in operational efficiency, risk reduction, and customer personalization, hinting at AI's future impact on the industry.

Highlights

• Banks like JP Morgan and HSBC are leading in AI adoption 📈.
• AI aids in areas like payment validation and fraud detection 🔍.
• Barkley uses AI to boost customer service efficiency 🤖.
• AI-driven solutions in banking lead to cost savings and better compliance 💸.
• There's a growing trend of experimenting with AI for personalization in financial services 💡.

Key Takeaways

• AI is surprisingly prevalent in banking, alongside IT and automotive industries 🚗.
• JP Morgan uses AI to enhance payment validation, improving efficiency 📊.
• HSBC benefits from AI in fraud detection, reducing alert volumes by 60% 🔍.
• Barclays' AI chatbot improves customer service around the clock 🤖.
• Adoption of AI in banking promises fraud prevention and better customer interaction 🌟.

Overview

Welcome to Jelvix's insightful dive into the world of AI in banking—a sector surprisingly leading the charge in AI adoption. While most of us might peg tech or automotive industries as the primary adopters, banking has quietly moved up the ranks. This episode reveals curious uses of AI by financial giants like JP Morgan and HSBC, illustrating how deeply entrenched AI is becoming across finance.

Take, for instance, JP Morgan’s innovative use of large language models for payment validation. They managed to optimize operations and reduce false alarms, showcasing AI’s potential to refine complex financial procedures. Similarly, HSBC's application of AI in their anti-money laundering strategies highlights cutting-edge efforts to curtail fraud and ensure compliance, taking advantage of real-time data processing to stay ahead of illicit activities.

And it doesn’t stop at back-end operations! Barclays has astonishingly integrated AI to reinvent customer service through their chatbot, offering 24/7 assistance and enhancing customer interaction. The narrative here is clear: AI not only optimizes operational tasks but revolutionizes customer engagement, setting a new standard for service within the finance industry.

Chapters

• 00:00 - 01:00: Introduction and Context Setting The introduction sets the context by welcoming the audience to the Jelix channel, a space dedicated to insights and curiosity. It notes the recent surge in AI innovations and the prevalence of discussions around the subject, particularly among members of the Jelix team. These discussions led to a bet among the team members about the sectors that most avidly use machine learning. The chapter invites the reader to guess the top three fields before revealing that the IT industry is one of the leading adopters of AI.
• 01:00 - 02:00: AI Growth Dynamics in Banking The chapter titled 'AI Growth Dynamics in Banking' explores the unexpected yet significant rise of artificial intelligence (AI) in the banking, financial services, and insurance industries. Despite initial skepticism, the adoption of AI in these fields has caught the attention of many. The chapter discusses how renowned banking and financial institutions are leveraging AI by reviewing top cases of its implementation. It is part of a series by Jelix, a software development partner, which regularly posts technology-related content.
• 02:00 - 02:30: Case Study: JP Morgan Chase Before delving into real-life case studies, this chapter reviews AI growth dynamics in banking and financial services. Business Insider reports that 80% of banks acknowledge the potential benefits of machine learning technology. Additionally, AI-powered solutions are projected to save banks $447 billion in 2023. Beyond cost savings, generative AI is expected to create new value for banks, totaling up to $340 billion. Some countries are already optimizing this potential, with 72% of banks in the United Kingdom being highlighted.
• 02:30 - 03:30: Case Study: HSBC and Anti-Money Laundering The chapter focuses on the integration of machine learning techniques into operations by insurance companies, highlighting that while many sectors lag behind in AI adoption, banks are leading in AI usage. Banks, including JP Morgan Chase, are actively testing AI solutions to improve various aspects of their services. The narrative sets the stage for examining HSBC's efforts in combating money laundering, likely exploring how AI plays a role in their strategies.
• 03:30 - 04:30: Impact on Customer Service: Barclays The chapter discusses the impact of AI language models on customer service at Barclays, particularly in payment validation screening over a 2-year period. The implementation helped speed up processes, improve queue management, and reduce false alarms. Consequently, there was a 15-20% decrease in rejection rates for account validation. Furthermore, the chapter hints at broader industry efforts to tackle fraud using AI, referencing Google's 2023 launch of an AI solution for anti-money laundering.
• 04:30 - 05:30: Other AI Initiatives in Banking The chapter discusses the use of AI algorithms in banking, focusing on real-time transaction data analysis to identify and prevent fraud. These AI solutions also create customer risk scores and offer detailed information for investigations. An example is given of how a banking operation, HSVC, significantly benefited from integrating AI, with improvements in risk detection, operational cost-effectiveness, and regulatory compliance. A notable result was a more than 60% decrease in alert volumes, indicating increased efficiency in fraud prevention. The narrative supports AI's capability in enhancing operational effectiveness in banking.
• 05:30 - 06:00: Conclusion and Viewer Engagement The chapter discusses the impact of AI on customer service, focusing on a case study of Barkley, a British multinational bank. Barkley introduced an AI-powered chatbot named Barkley's Assistant to enhance customer service. The chatbot offers 24/7 assistance, understands customer queries, provides relevant information, and offers personalized recommendations. This innovation led to improved customer service operations and increased cost efficiency.

AI in banking: TOP use cases and examples Transcription

• 00:00 - 00:30 welcome to the jelix channel the space of insights and curiosity with a recent surge in AI Innovations discussions about AI are impossible to ignore especially for curious minds like those of jelix teammates recently AI teammates made a bet about which sectors are the most Avid users of machine learning and to their surprise none of them guessed all of them correctly could you try to guess the top three fields that actively use AI we'll give you a couple of seconds to think it through all right ready for the truth to be revealed well the top three industry's currently leading AI adoption are it and
• 00:30 - 01:00 Communications Banking and the automotive industry and while it was a common guess among jelic teammates banking was an unexpected surprise for most so intrigued by this finding we decided to further explore the application of artificial intelligence in the banking financial services and insurance Industries in this video we'll follow the steps of renowned Banking and financial institutions and review their top cases of AI adoption we're jelix a software development partner for industry leaders WE Post weekly videos on Tech in 5 minutes don't forget to subscribe
• 01:00 - 01:30 now before getting to the real life cases let's review the AI growth Dynamics in the Banking and Financial Services field according to Business Insider around 80% of banks recognize the potential advantages of machine learning technology and moreover Banks were projected to save $447 billion in 20123 with the help of AI powered Solutions in addition to cost savings generative AI is expected to deliver new value to Banks totaling up to $340 billion and some countries are already maximizing this potential for example 72% of United United Kingdom Banks and
• 01:30 - 02:00 insurance companies integrated machine learning techniques into their operations which is pretty impressive considering that nearly a third of companies across all business sectors don't yet utilize AI at all this data proves that banks are at the Forefront of AI usage today with many institutions actively testing AI solutions to understand the areas where they can play a significant role let's start with the case of JP Morgan Chase a multinational Finance Corporation and one of the top five world's most admired companies by Fortune JP Morgan Chase claimed to have been utilizing underlying AI power large
• 02:00 - 02:30 language models for payment validation screening over 2 years it helped them speed up processing improve Q management and minimize false alarms and as a result the company witnessed a reduction in rejection rates for account validation by 15 to 20% and this financial institution is not the only business attempting to tackle fraudulent activities in AI let's review our next case spotlighting the AI powered anti-money laundering strategy for hsvc in 2023 Google Cloud launched an AI powered anti-money laundering solution called anti- money laundering AI its AI
• 02:30 - 03:00 algorithms analyze massive transaction data in real time identify and prevent fraudulent activities create customer risk scores and provide investigation details for further review through Dynamic feedback loops hsvc benefited tremendously from the solution upon integrating it into their banking operations the company saw alert improvements in Risk detection operational cost Effectiveness and Regulatory Compliance besides their alert volumes decrease by over 60% which signifies the efficiency in preventing fraudulent activities we've already verified ai's ability to streamline and
• 03:00 - 03:30 optimize a range of banking operations but what about its impact on customer service well the jelix team has found a case to demonstrate just that Barkley a British multinational Universal Bank recently launched Barkley's assistant an AI power chatbot to elevate customer service offering 24/7 assistance across various channels the chatbot utilizes artificial intelligence algorithms to understand customer queries provide relevant information and offer personalized recommendations this led to improved customer service operations spanning from cost efficiency due to
• 03:30 - 04:00 reduced request processing time to enhance Customer Loyalty by providing accessible support services around the clock and these are only several out of many cases for example Goldman Sachs a leading Global Investment Banking and investment management firm announced working on a dozen generative AI projects another Vivid example of an active AI adopter is American Express this leading Financial Services Corporation oversees an in-house Innovation Hub called American Express Digital Labs which takes pride in launching up to 25 pilot projects every year with with many of them being AI
• 04:00 - 04:30 oriented lately specifically in the area of Predictive Analytics meanwhile both companies emphasize the cautious and meticulous nature of their experiments with AI therefore the industry tendency is that even though Innovative banks are Keen to explore AI advancements they also prioritize thorough testing and Analysis before widespread adoption so to conclude AI is supposed to revolutionize various banking operations soon through advanced algorithms and data analytics AI promises to prevent fraud reduce risks improve operational efficiency and personalize customer
• 04:30 - 05:00 interactions finally as promised the jvx team is excited to share a range of AI powered solutions for budgeting and financial management have you tested out or heard of any of them share with us in the comments hopefully you enjoyed this video next we recommend watching our video on our favorite AI productivity tools make sure to support us by liking this video and leaving a comment and don't forget to subscribe and press the Bell button bye for now