Banks have been using AI for a long time, even before ChatGPT became popular. They started experimenting with AI in the late 2000s in areas like customer service and fraud detection. As the technology matured with time, use of AI in banking shifted from the experimental stage to the fundamental pillar for banks worldwide.
Big banks are the motivators and pioneers behind this transformative shift. Here are the key areas where popular banks across the globe are banking on AI.
JPMorgan Chase, the world's largest bank, leads way in using AI in banking with over 300 practical applications already in use. These AI solutions focus on helping customers with their financial needs, including accessing services, making investments, and planning for retirement.
One of their notable AI solutions is IndexGPT, a financial advisor that helps customers choose the right investments based on their financial situation. It gives personalized advice on where and how to invest.
JPMorgan Chase has trademarked IndexGPT, sparking interest from other banks that are developing similar tools. However, IndexGPT is not yet available to the public and may be launched in 2026-2027.
Recently, JPMorgan Chase patented another AI tool similar to a finance assessment tool. However, it gives personal advice and suggestions on saving money and making wise investments.
Read More: Hyperautomation in Banking: Going Beyond Robotic Process Automation
One of the major financial services providers in the United States is banking on AI to give fraud-free experience to its customers. It begins with knowing their customers’ spending habits and how they make purchases.
AI and machine learning algorithms help them understand these patterns and if anything, suspicious comes up, it sends instant alerts in real time to stop fraud. Customers can also report any suspicious activity or block their credit cards to avoid financial loss.
Artificial Intelligence is the fundamental pillar of HSBC to deliver personalized and transparent banking solutions to their customers. From personalized banking, investment banking, wealth management, corporate banking, global banking, and markets, they are using AI everywhere. A few ways HSBC is using artificial intelligence:
HSBC is actively investing in artificial intelligence without overlooking the ethical side of using AI in banking.
Rapid digital transformation is one of the benefits of using AI in banking. Things are quick, accurate, and easy. Take the use case of Morgan Stanley, the global financial services firm in the USA, which is simplifying the toughest job of financial advisors.
Their internal team uses OpenAI’s GPT 4 to get valuable insights from their vast knowledge library with thousands of pages. This key information helps financial advisors to utilize their research and data collection for clients’ benefit. That’s not it.
Morgan Stanely took AI forward with its Next Best Action system. This AI tool personalizes the client communication and gives recommendations for investment and wealth management.
The US Personal Banking business of Citi Group is taking personalization seriously. AI is making this happen for them by analyzing the real-time interaction of their customers and helping them to suggest offers that attract them.
The industry generates around 2.5 quintillion bytes of data per day which is of no use without proper analysis. For AI, this data is a food that can fuel the growth engine of banking and financial services. Glass, Bank of America’s AI platform, is a real-life example of this use case.
It is a research analysis platform that extracts hidden patterns in the market and clients’ needs. These insights help sales and trading employees understand the market better and offer personal investment advice to the clients.
Erica, the virtual assistant of Bank of America, is the next best use case of AI in banking. However, the bank launched it way before the world got to know about ChatGPT. It is integrated into their mobile banking app and helps customers to put their cash to work most profitably.
It manages cards, gives all the information on account balances, sends payment reminders, alerts for recurring charges, and weekly reports on monthly sending. Most importantly, this bot gives credit score insights to help users improve their scores.
The $1.9 trillion Bank of the UK is the early adopter of AI in mobile banking. Santander uses voice technology to give their customers a hands-free banking experience. They can pay, report fraud activities, or ask about their transactions and balances through voice commands.
Integrating voice technology is not only to give a friction-free experience but also to make transactions more secure and accessible for every customer.
The above uses of AI in banking have been the foundation for banks worldwide. Now, even small, and medium banks are investing in artificial intelligence to get its advantages and stay in the competition. Here are a few more ways AI is used in banking where investments are made
Banks will invest heavily to expand their AI research team. And JPMorgan Chase is the live example. The world’s biggest bank alone has almost half of the AI talent available in the top 10 banks for AI research. They have published over 300 research papers and applications of AI in banking.
It has become a race for big banks worldwide to quickly launch their AI solutions whereas small and medium-sized banks are gradually scaling up. So, in the next five years, we will be guaranteed to see more applications of generative AI in banking particularly the transformative and innovative solutions.
In this picture, human’s role will shrink to the stage where they would only ensure that solutions will meet expectations or not. That is yet to happen as of now.
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