The financial world has been in a state of constant change for a while now. Most of the changes being brought about are positive, such as making the banking industry more transparent and interactive for customers. These changes are mainly brought about by the successful application of the latest technologies, including cognitive computing.
What is Cognitive Computing?
Cognitive Computing is a term coined to define the simulation of human thought via artificial intelligence and machine learning. Processes like pattern recognition, speech, and language processing are all examples of cognitive computing. In the banking industry, the collection of customer information is of paramount importance. This data is then analyzed and used to make the banking industry more customer friendly and efficient. In such a scenario, cognitive computing fits very well in the banking industry.
How cognitive computing is changing banking
IBM has recently stated that 88% of bank executives are planning on investing in cognitive computing for their organizations. Here are a few ways that cognitive computing is changing things in the banking industry:
1. Banks can now fine-tune their services on a micro and macro level–
The more information obtained by banks about their existing and potential customers, the more they can fine tune their services to satisfy them better. Cognitive computing helps in this aspect since it can easily create simulated responses according to the customer data input it receives. Banks are therefore able to collect more personalized data about their customers thanks to cognitive computing. They can later use this data to modify spending trends according to individual customers.
A great example of cognitive computing is the series of apps that can successfully sync your payments with your calendar, such as picking up flowers for your grandma or taking your family out to dinner. When the budget of a particular customer is about to exceed, caution messages are provided during/after every purchase to ensure that the customer doesn’t go into debt. These apps utilize the concepts of personal financial management with intelligent automation, the result of which clearly demonstrates a significant improvement in the relationship between customers and their banks.
2. Banks can now provide specific and relevant responses to customer queries-
The use of cognitive computing in the banking industry also gives you the freedom to explore and create intelligent interfaces that can have efficient conversations with customers. These interfaces sift through the data that is fed into it and gives you the answers to your queries. A good example of this would be a ChatBot.
Chatbots are assistants that are powered by artificial intelligence, used to streamline the customer service experience. Conversational interfaces are quickly cementing their place in the banking industry, with more and more banking organizations investing in them.
3. Banks can now implement more effective Cyber-Security measures-
For any bank, ensuring the complete protection of financial data is imperative. Cognitive computing technology operates to simulate human thought and behavior, including perceiving data the way humans would and then building solutions accordingly. Processes such as pattern recognition allow this technology to sift through data on a massive scale and detect anomalies, which ultimately leads to figuring out fraudulent and false transactions faster than anything seen before. Cognitive computing can also help your Cyber-Security systems by revealing all kinds of malicious software. Features like these make cognitive computing a key part of any bank’s Cyber-Security strategy.
4. Banks can now be more transparent-
There are many regulations required to be met by banks when it comes to implementing transparency. These complex regulations can be tough to follow without expert knowledge of data strategy and the current trends in data policies. All these limitations make it hard for banks to comply with all the regulations. With the arrival of cognitive computing, this task has become much easier since cognitive computing can track changes in data laws in real-time and give suggestions on how to apply them to your organization. Due to cognitive computing, long and arduous policy documents are read and understood at unmatched speeds thanks to which, organizations can keep with the rapid changes made to policies.
Cognitive computing has proved to be an incredibly beneficial tool for both organizations and customers. A few of the many ways cognitive computing is being used are- apps with built-in algorithms, artificial advisers, and many more. Cognitive computing has made a direct positive impact in how regular consumers manage their money.