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The role of chatbots in banking customer service

The boom in automatic solutions shows no sign of slowing. For years now, artificial intelligence and machine learning has played an important role in digital banking customer service.

Take the rise of chatbots or AI conversational interfaces in the financial industry as an example. There’s no doubt that chatbot technology can dramatically ease the workload of customer service advisors and offer a speedy, engaging, and efficient support system for customers. We’ve already reached the point where bots help customers deal with banking issues and queries on a daily basis.

That said, what’s also clear is that chatbot services have their limitations when it comes to ensuring an all-round positive customer experience. No matter how good the bots are, they can’t deal with complexity or the nuances of human emotions. When customers need reassurance or help with an important task, chatbots will never be able to provide the same level of personalized experience or personal touch that human advisors can achieve. 

It all comes down to this – to provide holistic customer service, it’s essential to offer a hybrid experience that draws on the strengths of Artificial Intelligence and Human Intelligence. By merging bot technology with online chat solutions, finance institutions can leverage the improved efficiency and productivity of chatbots, while retaining the insightful and emotionally resonant service that is only possible in person-to-person exchanges.

Leveraging human support in the banking sector

The use of advanced technologies such as digital assistants and artificial intelligence in banking improves customer service communication, resulting in a quicker and more efficient service. This is perhaps why a recent PWC report found that chatbots were among the top three most popular applications that banks are investing in. 

What’s more, it’s true that chatbots are popular among customers. When it comes to transactions such as bill payments or money transfers, the technology offers an efficient means of doing this. However this efficiency does have its limitations. Without the aid of human agents, self-service channels can negatively impact the customer experience in other contexts. For example, if a customer encounters a roadblock when carrying out a complex financial transaction, chatbots are not able to solve the issue and can have a negative impact on customer satisfaction.

The reason is that AI-powered chatbots are programmed to offer limited advice based on predetermined situations or questions. Even with leaps forward in machine learning, the ability to detect emotion or provide reassurance is simply impossible with chatbots.

Gaining control through omnichannel capabilities

When customers require personalized advice or need to carry out complex tasks, they need the option to transfer between human and digital channels seamlessly and at their own convenience. This means providing an omnichannel experience that gives customers control over whether they talk to a bot or a human – and customers are very clear on this point.

While around a third of European and American customers trust chatbots to handle basic queries or simple financial tasks, when it comes to complex financial tasks almost two thirds don’t trust the bots at all.

In response to these challenges, conversational AI chatbots should be thought of as a tool for quick answers to simple customer queries that enhances service agents’ capabilities, rather than replaces them. While chatbots are capable of simply conversations that convincingly mimic financial services agents, they still don’t have the capacity for nuanced understanding and connection-building that humans have. This is why, when hybrid experiences are provided, customers score them higher on effectiveness, ease, and emotion than digital-only or physical-only options.

Chatbots should be the first point of contact, with customers able to request human intervention whenever they desire. Being able to transfer from interacting with a bot to speaking to a human in real time ensures that no customer is left without the help they need. This is especially important in the context of complex customer service inquiries that require nuance, sensitivity, and understanding, which chatbots are incapable of emulating.

Use cases: How chatbots can benefit the banking industry

Different customers have different needs in the banking industry. Younger customers, for example, will often be happy with self-service tools as they are more familiar with digital technology. Others in wealth management might have more complex needs and require advanced recommendations using a more traditional, hands-on approach. 

Given this diversity of customer needs, banks must offer a digital experience with multiple channels of communication. By considering different points of the client journey, conversational banking can evolve for each situation.

Enhancing customer self-service with simple solutions

Human intervention is not necessary to solve simple issues. If a customer comes across a barrier when paying a bill or transferring money, there’s a definitive out-of-the-box answer to their problem.

Contacting a customer service agent is a waste of time for both parties and chatbots offer a quick solution – allowing the customer to move on with their day. While unsuitable for banking services that require more complex solutions, artificial intelligence is a serviceable conversational touchpoint for simple interactions.

Take Bank of America's hybrid chatbot Erica for example, which talks regularly to more than 1.5 million banking customers daily; or Capital One, which allows customers to access their bank accounts through the intelligent chatbot Alexa. The success of these initiatives means that 79% of North Americans are now willing to receive computer-generated advice on investments. What’s more, a similar number say they’d be happy to talk to a bot for advice when opening an account.

Instant responses – the incomparable speed of chatbots

Service agents are irreplaceable when it comes to providing authentic, personalized support. However, there are areas where no human will ever be able to compete with a bot. Above all, when it comes to speed.

Chatbot support is not just fast – it’s an instantaneous digital service. When a customer runs into difficulty with a mobile banking transaction, sitting on the end of a phone line becomes quickly frustrating. Even more traditional self-service options like scrolling through FAQ pages is time-consuming.

To get quick answers that are immediately actionable, a virtual assistant is the best solution. Natural language processing has come on leaps and bounds in the last few years, meaning chatbots can have refined conversations that provide answers to simple questions within seconds.

As a consequence, the customer experience radically improves and satisfaction levels climb significantly, which directly influences loyalty and retention levels. When customers have a simple task, any delay can be frustrating and receiving prompt answers makes all the difference.

Chatbot limitations when providing complex customer support

However, when it comes to complex queries that require a certain level of sensitivity – such as mortgage inquiries or loan applications – chatbots are not able to navigate the nuances of conversation to emulate human-like interactions. While chatbots might serve as a starting point, customers generally want to transfer to a human advisor.

By offering customers this option via live chat or asynchronous messaging, banks can reap the benefits of chatbot technology without taking any risks. They safeguard against the possibility of customers becoming frustrated or questions going unresolved.

For many banking customers, a private messaging channel will provide the most convenient point of contact. Unlike with simple queries, speed is not necessarily the most important requirement. While a credit union or retail banking messenger can be instant – many customers are happy with asynchronous support as they would with an SMS or WhatsApp if the quality of the advice is better.

It’s worth noting that this isn’t added-value service but a baseline customer expectation. Statistics show that 81% of today’s consumers expect brands to offer customer engagement via private messaging channels, and this includes financial matters. To meet these rising customer demands, banks should integrate the use of these popular end-to-end encrypted instant messaging apps (WhatsApp, Facebook Messenger and WeChat) for ultimate convenience. In this way, they’re able to offer a sublime customer experience that delivers ease and personalization.

Cost-effective lead generation with chatbots

Not only can conversational banking chatbots resolve issues in a prompt and efficient manner, but they can also help generate qualified leads. During a conversation with a customer, they can suggest particular banking products and gauge interest. These leads can then be sent to sales teams for follow up, allowing chatbots to generate leads without any additional operational cost to the bank.

Rather than email campaigns and cold calls – which customers find irritating and tend to ignore – being suggested products within the context of a helpful conversation feels more natural. Therefore, chatbots can generate leads without the risk of alienating customers.

Chatbot software integration and Unblu

A chatbot solution with a live chat option offers the perfect interplay between the high-tech and the human. Bank customers enjoy both the convenience of AI and the reassurance of human-to-human exchange to resolve simple queries when they want or get the personalized services they need for complex issues.

Reduce costs, improve customer satisfaction, generate leads, and save time without taking risks. Book a demo today and one of the Unblu team members will reach out to offer advice.

Conversational Banking,Chatbots,Retail Banking