Banking is technology. Technology is humans … a well-known industry mantra. So, will banking clients soon be served by androids in pinstripes? Or will whole banking operations succumb to thinking machines as our new masters? We think not.
Artificial intelligence, intelligent automation and robotics are nonetheless key elements of the technological revolution being driven by the financial industry. Banking has never been afraid of adapting and using new technologies. After all, we pioneered the automatic cash dispenser (ATM) over 40 years ago. In the 70's, electronic stock trading began on exchange trading floors. Banks are yet again among the leading advocates and consumers of new emerging technologies. This is also reflected in numbers. Financial services have the second largest technology spend behind the technology sector itself.
Looking into the near future we predict cognitively intelligent machines will make banking services even more accessible and nimble. A bank like ours is particularly interested in exploiting rapid advances in audio and visual recognition technology as well as in secure and convenient method of customer authentication. For example, an artificial intelligence enabled personal financial manager (PFM) can alert customers to potential cash-flow problems, and identify where you can save money. Artificial intelligence can also be used to make banking more interactive. One start-up has already designed a voice-recognition add-on for mobile banking apps.
Just as importantly, these new technologies offer banks the ability to reduce complexity and manage rising costs in the face of regulatory and market pressure. Intelligent machines and applications bring even greater effectiveness and efficiency in automating routine processes. We already use automated systems to check and validate client documentation when we on-board new customers, or to ensure existing customers comply with new regulations. As machines become more "intelligent", they will be able to undertake more complex tasks, like credit scoring or automated report writing. For example, we are already using a leading cognitive computing solution to handle IT incidents more efficiently.
Automation and artificial intelligence will not only have a great impact on the operating environment and how we interact with clients, but also on how bank employees will do their jobs. "Thinking" machines have the potential to become our trusted and dependable assistants, enhancing human capabilities and allow us to free people from routine work, empowering them to concentrate on more creative, value-added services. This is an important point especially in view of the fears about intelligent machines substituting humans and taking our jobs. As with any new technology, we will all need to adapt to an increasingly automated workplace. We must be willing to learn in order to understand and make the best use of the computing and self-learning power of intelligent machines.
The path for intelligent automation will not be straightforward. To succeed in an inherently data-driven world, automation and robotics will have to be robust, compliant and well governed. Financial services organizations, policymakers and regulators will need to work together on prudent rules and issues of liability without stifling innovation.
Banks should also not underestimate issues around the acceptance of "intelligent" machines by their workforce and clients. In future, managers will need to have the skills to lead a workforce enhanced by artificial intelligence. There is no doubt that streamlining and reconfiguration of the operating environment and digitalization, driven by artificial intelligence, intelligent automation and robotics, needs to be pursued in tandem in this evolving landscape.
If we get it right, intelligent automation will help us provide clients with more compelling and insightful services. It will relieve people of mundane and repetitive tasks and free them to do more creative and fulfilling work. It will also make banking operations more efficient and responsive. We all stand to gain.
Axel P. Lehmann
Group Chief Operating Officer of UBS.
