“Leveraging the power of AI” - 3 Key Takeaways from Swift Business Forum 2018

On Tuesday, at SWIFT Business Forum 2018, I sat on the panel for a discussion on leveraging the power of AI in the financial services industry. It was great to see such a large audience for the event and high levels of interest around AI. Throughout the panel we had an unprecedented number of questions across a broad variety of topics. After a live poll it became clear that most of companies represented in the audience feel they are only at the beginning of their AI journey. However, with so much hype and promise around AI a lot of people are keen to get down to the nitty-gritty, which means asking the questions where are we with AI today and how can it help me?

So to break it down for you, here are some of my key takeaways from the discussion:

1.   Where are we with AI today?

AI today is far from changing complex end to end business processes. At this point, it should be used for processing large volumes of data to provide a specific output to feed the data pipeline into an existing business process. Essentially, we can look at AI as an instrument in an organisations toolkit that can be used to address current and future business challenges as well as create business opportunities. It is capable of providing new insights across vast amounts of complex data. In many cases, this type of processing cannot be achieved using either rules or human beings. For example, it is possible to use AI to predict what a customer wants based on past behaviour. With this information it is possible to maximise Customer Lifetime Value (CLV), predict customer churn and ensure that product cross selling is effectively targeted. Any AI implementation should be based on a solid strategy with specific use cases evaluated and selected based on their ability to drive the right value. AI can be used to mask bad business processes but this is not driving the highest value of AI. The strength in value of AI is behind its ability to improve efficiency with recommendations derived from an analysis of large volumes of data. This is where the term, machine-learning comes in, through the identification of patterns and characteristics AI systems can make more precise recommendations.

2.   Why the hype right now?

In recent years consumer behaviour towards digital channels has changed massively. Companies are seeing the need to reduce the time consumers spend on interactions. For example, improving the relevance of information to a client on service portals can massively enhance customer experience. Consumption has now gone digital, meaning a much larger stress on computational power. High Performance Computing combined with the acceleration technology in GPUs has been critical in the establishment of AI due to the levels of data ingest required. The result has been a shrinking in the length of time that it takes to train AI. So ultimately, technology has caught up with the theory, enabling us to make quick changes in the industry. Alan Turing would be proud.

3.   Where can AI be used in the FSI sector?

We are seeing loads of early advances in financial services industry. For example, chatbots are now more effective at selling insurance policies than a person. That’s just one example. AI is also being used in fraud detection, open banking and even capital markets to calculate risk. As FSI organisations begin to adapt to the greater expectations of customers, the complexity of security threats and decreasing operational expenses, AI is having an impact by increasing relevancy and significance of organisations to their customers in a secure and targeted way.

The recent announcement of the UK government’s ￡1 billion AI sector deal also presents a significant opportunity to create competitive advantage for the UK economy. AI is not just enabling us to push forward with innovation and scientific discovery but also improve productivity and provide economic growth. One of the parting thoughts we had on the panel was from the CEO of a software company, he said “any tool is only as effective as the problem it is being used to solve”. We are now only at the beginning of identifying these problems and with such a wealth of opportunities ahead of us, the possibilities are endless.