What is a Chatbot & Its Dangers
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What is a Chatbot & Its Dangers

What is?Chatbot ?

A?chatbot?or?chatterbot?is a?software?application used to conduct an on-line chat?conversation?via text or?text-to-speech, in lieu of providing direct contact with a live human agent.Designed to convincingly simulate the way a human would behave as a conversational partner, chatbot systems typically require continuous tuning and testing, and many in production remain unable to adequately converse, while none of them can pass the standard?Turing test.?The term "ChatterBot" was originally coined by?Michael Mauldin?(creator of the first?Verbot) in 1994 to describe these conversational programs.

Chatbots are used in?dialog systems?for various purposes including customer service, request routing, or information gathering. While some chatbot applications use extensive word-classification processes,?natural-language processors, and sophisticated?AI, others simply scan for general keywords and generate responses using common phrases obtained from an associated library or?database.

Most chatbots are accessed on-line via website popups or through?virtual assistants. They can be classified into usage categories that include:?commerce?(e-commerce?via chat),?education,?entertainment,?finance,?health,?news, and?productivity.

Defining the Use of Chat Bots

Messaging apps

Many companies' chatbots run on?messaging apps?or simply via?SMS. They are used for?B2C?customer service, sales and marketing.

In 2016, Facebook Messenger allowed developers to place chatbots on their platform. There were 30,000 bots created for Messenger in the first six months, rising to 100,000 by September 2017.

Since September 2017, this has also been as part of a pilot program on?WhatsApp. Airlines?KLM?and?Aeroméxico?both announced their participation in the testing;both airlines had previously launched customer services on the?Facebook Messenger?platform.

The bots usually appear as one of the user's contacts, but can sometimes act as participants in a?group chat.

Many banks, insurers, media companies, e-commerce companies, airlines, hotel chains, retailers, health care providers, government entities and restaurant chains have used chatbots to?answer simple questions, increase?customer engagement,for promotion, and to offer additional ways to order from them.

A 2017 study showed 4% of companies used chatbots.According to a 2016 study, 80% of businesses said they intended to have one by 2020.

As part of company apps and websites

Previous generations of chatbots were present on company websites, e.g. Ask Jenn from?Alaska Airlines?which debuted in 2008or?Expedia's virtual customer service agent which launched in 2011.The newer generation of chatbots includes?IBM Watson-powered "Rocky", introduced in February 2017 by the?New York City-based?e-commerce?company Rare Carat to provide information to prospective diamond buyers.

Chatbot sequences

Used by marketers to script sequences of messages, very similar to an?Autoresponder?sequence. Such sequences can be triggered by user opt-in or the use of keywords within user interactions. After a trigger occurs a sequence of messages is delivered until the next anticipated user response. Each user response is used in the decision tree to help the chatbot navigate the response sequences to deliver the correct response message.

Company internal platforms

Other companies explore ways they can use chatbots internally, for example for Customer Support, Human Resources, or even in?Internet-of-Things?(IoT) projects.?Overstock.com, for one, has reportedly launched a chatbot named Mila to automate certain simple yet?time-consuming?processes when requesting sick leave.Other large companies such as?Lloyds Banking Group,?Royal Bank of Scotland,?Renault?and?Citro?n?are now using automated online assistants instead of?call centres?with humans to provide a first point of contact. A?SaaS?chatbot business ecosystem has been steadily growing since the?F8?Conference when Facebook's?Mark Zuckerberg?unveiled that Messenger would allow chatbots into the app.In large companies, like in hospitals and aviation organizations, IT architects are designing reference architectures for Intelligent Chatbots that are used to unlock and share knowledge and experience in the organization more efficiently, and reduce the errors in answers from expert service desks significantly.These Intelligent Chatbots make use of all kinds of artificial intelligence like image moderation and?natural-language understanding?(NLU),?natural-language generation?(NLG),?machine learning?and deep learning.

Customer service

Many high-tech banking organizations are looking to integrate automated AI-based solutions such as chatbots into their customer service in order to provide faster and cheaper assistance to their clients who are becoming increasingly comfortable with technology. In particular, chatbots can efficiently conduct a dialogue, usually replacing other communication tools such as email, phone, or?SMS. In banking, their major application is related to quick customer service answering common requests, as well as transactional support.

Several studies report significant reduction in the cost of customer services, expected to lead to billions of dollars of economic savings in the next ten years.In 2019,?Gartner?predicted that by 2021, 15% of all customer service interactions globally will be handled completely by AI.A study by Juniper Research in 2019 estimates retail sales resulting from chatbot-based interactions will reach $112 billion by 2023.

Since 2016, when?Facebook?allowed businesses to deliver automated customer support, e-commerce guidance, content, and interactive experiences through chatbots, a large variety of chatbots were developed for the?Facebook Messenger?platform.

In 2016, Russia-based Tochka Bank launched the world's first Facebook bot for a range of financial services, including a possibility of making payments.

In July 2016,?Barclays Africa?also launched a Facebook chatbot, making it the first bank to do so in Africa.

The France's third-largest bank by total assets Société Générale?launched their chatbot called SoBot in March 2018. While 80% of users of the SoBot expressed their satisfaction after having tested it, Société Générale deputy director Bertrand Cozzarolo stated that it will never replace the expertise provided by a human advisor.

The advantages of using chatbots for customer interactions in banking include cost reduction, financial advice, and 24/7 support.

Healthcare

Chatbots are also appearing in the healthcare industry.A study suggested that physicians in the United States believed that chatbots would be most beneficial for scheduling doctor appointments, locating health clinics, or providing medication information.

Whatsapp?has teamed up with the?World Health Organisation?(WHO) to make a chatbot service that answers users’ questions on?COVID-19.

In 2020,?The Indian Government?launched a chatbot called MyGov Corona Helpdesk,that worked through?Whatsapp?and helped people access information about the Coronavirus (COVID-19) pandemic.In the?Philippines, the Medical City Clinic chatbot handles 8400+ chats a month, reducing wait times, including more native?Tagalog?and?Cebuano?speakers and improving overall patient experience.

Certain patient groups are still reluctant to use chatbots. A mixed-methods study showed that people are still hesitant to use chatbots for their healthcare due to poor understanding of the technological complexity, the lack of empathy, and concerns about cyber-security.The analysis showed that while 6% had heard of a health chatbot and 3% had experience of using it, 67% perceived themselves as likely to use one within 12 months. The majority of participants would use a health chatbot for seeking general health information (78%), booking a medical appointment (78%), and looking for local health services (80%). However, a health chatbot was perceived as less suitable for seeking results of medical tests and seeking specialist advice such as sexual health. The analysis of attitudinal variables showed that most participants reported their preference for discussing their health with doctors (73%) and having access to reliable and accurate health information (93%). While 80% were curious about new technologies that could improve their health, 66% reported only seeking a doctor when experiencing a health problem and 65% thought that a chatbot was a good idea. Interestingly, 30% reported dislike about talking to computers, 41% felt it would be strange to discuss health matters with a chatbot and about half were unsure if they could trust the advice given by a chatbot. Therefore, perceived trustworthiness, individual attitudes towards bots, and dislike for talking to computers are the main barriers to health chatbots.

Politics

In New Zealand, the chatbot SAM – short for?Semantic Analysis Machine (made by Nick Gerritsen of Touchtech– has been developed. It is designed to share its political thoughts, for example on topics such as climate change, healthcare and education, etc. It talks to people through Facebook Messenger.

In?India, the state government has launched a chatbot for its Aaple Sarkar platform,which provides conversational access to information regarding public services managed.

Toys

Chatbots have also been incorporated into devices not primarily meant for computing, such as toys.Hello?Barbie?is an Internet-connected version of the doll that uses a chatbot provided by the company ToyTalk,which previously used the chatbot for a range of smartphone-based characters for children.These characters' behaviors are constrained by a set of rules that in effect emulate a particular character and produce a storyline.The?My Friend Cayla?doll was marketed as a line of 18-inch (46?cm) dolls which uses?speech recognition?technology in conjunction with an?Android?or?iOS?mobile app to recognize the child's speech and have a conversation. It, like the Hello Barbie doll, attracted controversy due to vulnerabilities with the doll's?Bluetooth?stack and its use of data collected from the child's speech.

IBM's?Watson computer?has been used as the basis for chatbot-based educational toys for companies such as?CogniToys intended to interact with children for educational purposes.

Malicious use

Malicious chatbots are frequently used to fill?chat rooms?with spam and advertisements, by mimicking human behavior and conversations or to entice people into revealing personal information, such as bank account numbers. They were commonly found on?Yahoo! Messenger,?Windows Live Messenger,?AOL Instant Messenger?and other?instant messaging?protocols. There has also been a published report of a chatbot used in a fake personal ad on a dating service's website.

Tay, an AI chatbot that learns from previous interaction, caused major controversy due to it being targeted by internet trolls on Twitter. The bot was exploited, and after 16 hours began to send extremely offensive Tweets to users. This suggests that although the bot learned effectively from experience, adequate protection was not put in place to prevent misuse.

If a text-sending?algorithm?can pass itself off as a human instead of a chatbot, its message would be more credible. Therefore, human-seeming chatbots with well-crafted online identities could start scattering fake news that seems plausible, for instance making false claims during an election. With enough chatbots, it might be even possible to achieve artificial?social proof.

Limitations of chatbots

The creation and implementation of chatbots is still a developing area, heavily related to?artificial intelligence?and?machine learning, so the provided solutions, while possessing obvious advantages, have some important limitations in terms of functionalities and use cases. However, this is changing over time.

The most common limitations are listed below:

·??????As the database, used for output generation, is fixed and limited, chatbots can fail while dealing with an unsaved query.

·??????A chatbot's efficiency highly depends on language processing and is limited because of irregularities, such as accents and mistakes.

·??????Chatbots are unable to deal with multiple questions at the same time and so conversation opportunities are limited.

·??????Chatbots require a large amount of conversational data to train. Generative models, which are based on deep learning algorithms to generate new responses word by word based on user input, are usually trained on a large dataset of natural-language phrases.

·??????Chatbots have difficulty managing non-linear conversations that must go back and forth on a topic with a user.

·??????As it happens usually with technology-led changes in existing services, some consumers, more often than not from older generations, are uncomfortable with chatbots due to their limited understanding, making it obvious that their requests are being dealt with by machines.

Chatbots and jobs

Chatbots are increasingly present in businesses and often are used to automate tasks that do not require skill-based talents. With customer service taking place via messaging apps as well as phone calls, there are growing numbers of use-cases where chatbot deployment gives organizations a clear return on investment. Call center workers may be particularly at risk from AI-driven chatbots.

Chatbot jobs

Chatbot developers create, debug, and maintain applications that automate customer services or other communication processes. Their duties include reviewing and simplifying code when needed. They may also help companies implement bots in their operations.

A study by?Forrester?(June 2017) predicted that 25% of all jobs would be impacted by AI technologies by 2019

What are fake chatbots ?

The fake chatbot page is?designed to build trust and keep people hooked. On this page, the user will get an option to choose between - fix delivery or the link given - both will redirect to the same website. After choosing the option, a chat box will appear where the person is asked to confirm the tracking number

Chatbots and artificial intelligence (AI) dominate today's society and show what's possible. However, some people don't realize the AI platforms they love to use might be receiving their knowledge from humans. The phenomenon of so-called pseudo-AI happens when companies promote their ultrasmart AI interfaces and don't mention the people working behind the scenes as fake chatbots.

When and Why Did These Problems Start

Speaking broadly, pseudo-AI and fake chatbots have only been around for a few years at most. That makes sense, since both AI and chatbots — which use AI to work — have recently reached the mainstream.There's no single answer for why businesses started venturing into the realm occupied by pseudo-AI and fake chatbots, but saving money inevitably becomes part of the equation.?Human labor is cheap?and often easier to acquire than the time and tech needed to make artificial intelligence work properly.

Some companies begin by depending on humans because they needed people to train the algorithms by using technology in ways similar to real-life situations. Humans are always involved in AI training to some degree, so that isn't unusual.Unfortunately, though, in their eager quest to gain the attention of wealthy investors, some companies give the impression their platforms or tools are already past the stage of needing such thorough training and are fully automated.

That's called "The Wizard of Oz" design technique,?because it reminds people of the famous movie scene where Dorothy's dog, Toto, pulls back the curtain and reveals a man operating the controls for the Wizard's giant talking head.

Some scheduling services that used AI chatbots to book people's appointments reportedly didn't mention they required humans?to do most of the work. Workers would read almost all incoming emails before the AI generated an auto response. Employees often are hired to be an AI trainer. Then, it seems like they're only involved in helping the AI get started, not overseeing the whole process.

The Culture of Secrecy in the Tech Industry

Elizabeth Holmes, the CEO of the now-disgraced blood testing company Theranos, is a perfect example of how much prestige a person or tech company can gain without solid technology to show to the public. Holmes had fantastic ideas for her products, but received early warnings from development team members that the things she envisioned were not feasible.

The company captured attention from impressed members of the media even though Holmes didn't have working prototypes for most of her planned features. One of the reasons Theranos avoided ridicule for as long as it did is the culture of secrecy in the tech sector. As a company works on a project that could become the next big thing, it has a vested interest in staying quiet about its operations and what's in the pipeline.

As such, tech investors may be more willing not to press company leaders for details about their AI, making it easier to supplement projects with humans. People have raised concerns about?how to make AI that's ethical. That's important, but when they think about ethics for AI, individuals don't typically think of pseudo-AI.

Detecting Real vs. Fake AI

It's increasingly important for people to be as informed as they can about whether the AI they're using is fully automated or is a type of pseudo-AI. Fortunately, there are?things to check for?that can help find the real stuff.

If a solution is transparent to the user and lets them see how it works, that's a good sign. Likewise, if a company provides substantial details about its technology and functionality, it's more likely it doesn't depend on humans too much.

People can also find out if the AI does things for users or only provides insights. If it carries out tasks and does so more efficiently than humans, that constitutes real AI.

When startups have datasets of unique and specialized information, the likelihood goes up?that they're using real AI. Many companies that try to promote something fake focus too much on automation and not enough on the information that helps the algorithm work. Keep in mind that automated technology needs instructions to work, but true AI learns over time from the content it's trained with and its future interactions.

The Trouble With Digitally Synthesized People

People have various definitions when they describe artificial intelligence. Perhaps that's because experiments and progress happen at a rate that makes it difficult to pin down what AI can do or might in the future.

Some companies have taken advantage of that lack of definition. In China, a Beijing-based company partnered with a state news agency and built what it?presented as an AI news anchor. It used machine learning algorithms to teach the AI about a real news anchor's likeness and voice, and then fed the AI content needed for reading the news.People soon asserted that the anchor was a digitally synthesized person constituting only a very narrow use of AI. Some pointed out that it was nothing more than a digital puppet.

That hasn't stopped companies from creating a slew of digital people, often celebrities that have passed away. One company uses digital scanners to?capture every detail of a person's face?down to the pores and how blood flow causes complexion changes during some facial expressions.There's no problem with aiming to achieve that level of accuracy when the audience is fully aware that the "person" they're seeing is a digital rendition. However, critics mention how we might soon have a culture of false celebrities to go with the fake news that's rampant.People must be cautious about believing new technology is real just because it's so amazing. Some AI is authentic, but there are plenty of cases where things are not quite as they appear.

Threats & Dangers of Fake Chat Bots

AI-powered ChatBots

Round the clock availability is the major criteria for the modern day business. ChatBots fulfills this requirement using Artificial Intelligence that simulates the conversations of the people.?AI-powered ChatBots serves as the first point of contact between customers and organizations and also helps in reducing expenses. As digital revolution is taking place at high speed, ChatBots plays a vital role in this modern era of transformation.

ChatBots has tremendous potential to change the way we live in and has many good things which human can’t do. Here is the list of features of ChatBots:

  • ?Bots overtake the mobile applications
  • ?Nothing needs to be learned by the human
  • ?Bots provide a great user experience
  • ?Bots act as media for business and customer

Though ChatBot is a major innovation in?AI, it has few disadvantages and potential risks. Here are some of the problems of ChatBots:

  • ChatBots has high error rate: They are just software systems and cannot capture variations in human conversations. Thus resulting high error rate and less customer satisfaction.
  • The problem of reliability: With advanced machine learning concepts, ChatBots are becoming highly skilled in imitating human conversations. Though it seems to be an advantage, it has another end also – as hackers can easily create bots to convince users to share personal information which is highly unsecured.
  • Bots can be too mechanical: ChatBots are pre-programmed by developers and can handle user queries when the conversation flow goes in a right path. If something unexpected which was not fed to that happens, the performance gets affected.
  • Risks of using standard web protocols: Though ChatBot has definitely a fair share of innovative features, it has a significant downside as these programs use open internet protocols and can be targeted by professional hackers.
  • Probable confusions affecting buying decisions: the major advantage of bot for buyers is they can be allowed to check products in the chat window itself instead of checking in online portals which cause probable confusion that affects the users buying decision.
  • Low-level job openings being eaten up: As Intelligent ChatBots are programmed using latest Artificial Intelligence support, ChatBots serves jobs much faster than human workers which increases the productivity of the business. ChatBots are acting as a substitute for humans which causes a serious threat to humans at low-level positions.
  • Fails the Turing Test: Turing test will be performed on ChatBots to measure the intelligence of machines. Most of the ChatBots do not pass this test risking the conversations unfulfilled. ChatBots might be highly intelligent, but they can’t think of themselves on their own which ends up in failure.
  • Data handling on ChatBot platforms: while using ChatBots, business has to track user data and follow clear-cut policy on how and where data has been stored. People must trust the ChatBots and consequently trust the business.
  • Lack of individuality and generic conversations: with the help of Natural Language Processing, ChatBots behave like humans with end users.?However, ChatBots does not have their own personality to come across too generic conversations. As there are no feelings and emotions, it becomes critical to interact with humans.
  • Accuracy: As ChatBots are still emerging, mistakes in speech recognition and natural language processing is still happening.
  • The need for encryption: every conversation that takes place in the bot should be encrypted to maintain digital data security. If it is deployed in the non-encrypted platform, there might be chances of data hijack.

Unfortunately AI and chatbots can be used for evil too. Because AI Is specifically designed to better understand us as individuals, it is an ideal tool for identity thieves. The more they know about you, the easier it is to impersonate you.

As a result, shoppers need to be extremely careful about the websites that they visit, and the systems they interact with. Talking with a malicious chatbot could be as dangerous as entering your credit card details into a phishing website.

As AI matures and becomes cheaper to operate, we expect to see more examples of criminals misusing the technology to commit more identity fraud-based crimes. Over time, these systems may even be able to pull together data from multiple sources, like your Facebook profile, as well as using information supplied to fake chatbots.

  • The more information the AI can access, the more detailed a picture hackers can build of you, your preferences and interests. Which means that when they do try and exploit your data, their efforts will be much more convincing – and likely to succeed.
  • To help stay aware of these dangers, and to prevent being tricked my malicious AI and chatbots, you should install a robust anti malware toolkits. Not only will this help keep your computers virus free, but it will also alert you whenever you visit a dangerous site – or even block access completely.

The Real Dangers Lurking Around - Always Working Means Constant Supervision

AI is never going to be perfect. There will be instances where an AI will need a human’s input for new scenarios. This could be a customer presenting a problem it’s never accounted for, attempting to respond to a troll trying to mess with it, or even something as simple as incorrect grammar.

Because your AI is always working and constantly learning, which then requires somebody to be available to supervise it. You can’t just let your AI run wild and expect it to handle everything on its own; you’ll need somebody who can guide and direct it, and step in if something goes wrong. That means having a system in place where?specific employees will be contacted and expected to help out?if the AI requires help all hours of the day, which is called human-in-the-loop.If you don’t have a supervisor keeping an eye on your AI,?you run the risk of it going rogue. There won’t be a robot uprising, but it could result in unhappy customers or lost leads, depending on what your chatbot is doing.

There is a caveat to the “always-working chatbot.” If the power goes out where the chatbot is housed — whether it’s in a server in the office or across the globe — your chatbot goes with it. Similarly, Internet outages still happen occasionally, and natural disaster can cause connection issues affecting an entire country.Humans are unpredictable creatures. While a large amount of human behavior falls into a normal range, outliers always exist. For every 99 people who act a specific way when talking to an AI chatbot, there will always be the one that acts crazy. — that does not act in a predictable way.

Humans can improvise and try to come up with something on the fly, but?AI struggles in this department. If presented with an entirely new and unexpected challenge, everything might crumble. Either the AI will have to pass the problem on to a human or it will try to take a stab at it and likely fail.The more an AI learns, the better prepared it is, and when presented with something truly new, there could be a system in place where it gets coached by a programmer on appropriate responses. It’s important, though, that there is a system in place for when an unexpected situation arises so that a human can quickly and seamlessly step in.

Depending on what your AI chatbot does, it might end up collecting some pretty valuable and personal information. That can include:

  • Geo-location or addresses
  • Account information
  • Payment information
  • Full legal names
  • Other information useful in stealing an identity

However, that wealth of data your AI is collecting makes both the chatbot and your database?a target for hackers. You have to make sure you do whatever is necessary to protect that info. That means virus protection, firewalls, long and complex passwords, and making sure all your employees know best practices for staying safe.

Another area you need to protect is the chatbot itself. Any vulnerabilities the chat system has could be used by criminal hackers. For example, if your chatbot accepts files or attachments, like a photo or copy of a bill, that system could be used to upload a virus. That virus could then infiltrate the database, or even add coding to the AI where it forwards future info to the hackers.Cyber criminals want this data for two different reasons: to steal and use for their own benefit, or to block your access from it and demand payment (“ransomware”) to get it back. Be sure to keep your data?regularly backed up multiple times and places,?both onsite and offsite; that way if disaster does strike, you’ll at least still have a current copy of the data.Anybody who grew up with chatbots in the ’90s, or even with voice assistants like Siri today, has tried in one way or another to manipulate them; things like getting them to say cuss words, give incorrect info, or call us “Captain of the U.S.S. Enterprise” are all ways that people commonly tried to manipulate early chatbots.People have not changed since then. If they figure out that they’re talking to an AI chatbot, many are going to try and manipulate or break it.

A perfect example of this is when Microsoft built and released their?AI chatbot Tay on Twitter. Within a day, Internet trolls had the?AI spouting racist, sexist, and Nazi-supportive Tweets, alongside insulting anybody who tried to interact with it?–?thanks to its machine learning abilities.This is going to happen to your chatbot. People will try to manipulate it to say and learn wrong things, and try to sow chaos within your business. It is incredibly important that on a regular basis you have qualified workers scrub through the AI’s behaviors and remove any negative habits it has picked up. You also need to place specific blockers to prevent learning negative habits, like calling people bad names or using inappropriate memes.

People are more into texting than talking.?About 65% percent?of us would prefer to have a long and painful conversation via Whatsapp than to have one-minute phone call or face-to-face meeting. We text while driving, even though we know it’s extremely dangerous. Even when it comes to sacred traditions, families may still sit together at the dinner table, but more and more often, they’re texting other people.

There is simply too much going on: too many people to talk to, too many contacts to maintain — it can feel easier to live as a digital introvert, dealing with others at your own pace, than to waste energy on real-world conversations you don’t know how to start or how to end, and with frankly zero motivation to explain yourself when you simply are not in the mood.

With chatting being so popular, it’s no surprise that our world is full of chatbots. Sometimes they are made just to replace real-world company, sometimes they have specific functions. Chatbots are also in great demand on the corporate side: They are workers that you don’t have to treat well; they have no emotions; and they do exactly what they’re programmed to. Chatbot hype went through the roof when Telegram’s bots platform got a full-scale API. Lots of businesses immersed themselves in making chatbots then: customer service bots, support bots, training bots, information bots, porn bots, whatever.

The question is — do people really need that many chatbots in addition to real people? We humans are tricky pieces of meat: We experience empathy even when dealing with something that is lifeless by design — your car can have gender, your iPhone a name, and the list goes on.

With chatbots, we seem to project certain emotions onto those scripts and in a way start to think that they are alive, granting them personality they don’t have. This phenomenon is not new consider Apple’s Siri, the mother of?modern bots.Consider the possibilities. Let’s assume that bots are in fact a new trend and every company in the world will develop one or two or a hundred, one for every marketing activity. That, by the way, is exactly what is happening.What will the ecosystem look like? Huge contact lists with artificial connections a strong majority and real people a minority. The chatbots will talk to you, send you emojis, stickers, funny cat pictures, and links. But don’t kid yourself — they will also learn your behavior and do everything they can to sell you what their masters want you to buy.

That is what happens when you have futuristic technology managed by old-school mentality. And it’s just the tip of the iceberg: Cybersecurity issues are right there. Chatbots are a goldmine for social engineering and crime; they analyze people’s behavior and learn from it.

Phishing, ransomware, theft of credentials, identity, and credit cards — all of it will be way easier for hackers when they obtain amazing new tools capable of talking people into trouble using their behavioral patterns. Basically, an infected bot would tell you exactly what you want to hear, right when you expect it, so you’d have no reason to be suspicious.And that’s just basic hacking. The worst techniques have yet to be developed. What about identity duplication? Chatbots are a two-way street: When you’re talking to one, it is learning fast, and with the right settings it can learn not only to be more effective in talking to you, but also to copy your behavior to talk with third parties. By the way, that is exactly what the chatbot in Google’s Allo messaging app?is doing.

What could a rogue bot with access to your credentials and a knack for imitating the way you chat do with your mobile banking account or an enterprise chat system such as Slack or Lync? Well, certain elements of science fiction start to look a lot more realistic.Now think for a moment — is this what we need in our chats?

My personal opinion is a firm No. I’m not saying that bots are an entirely bad idea, nor that they are doomed to fail. Quite the contrary! However, I’m absolutely sure that as long as technology is free of the limitations of the human body, you don’t really need hundreds of them. One bot can do it all — provide support, chat with you, manage your meetings, and all manner of other things. I believe that a machine-learning personal assistant is totally viable and actually has amazing potential, both scientifically and economically speaking.

Here is where we come to another “but,” probably even more troubling than the one of cybersecurity. Realistically, only five companies in the world today can make a “global bot” and benefit from it: Apple, Google, Microsoft, Amazon, and Facebook.These guys process big data (huge data!), and that helps them make any bot service best in class. With access to petabytes of personal data, these companies’ bots are going to be the smartest and the most adaptive, accurate, and fast-learning. And the chatbots out there today? We’re all just beta-testers improving today’s methods for the big guys.

?The Goodness of using AI Chatbots & How to Use AI Chatbots for Fraud Detection ?

Living in the age of convenience, speed and accessibility, businesses and consumers look for tools that save time while offering better results. Online payments and AI chatbots are two such tools.?And with this comes the topic of fraud prevention.

Chatbots have improved the overall customer service experience. For banking and financial institutes, it has not only saved operational costs (an average of?$0.60?on every chatbot interaction), it has also enhanced fraud detection using AI.

But how can?AI chatbots?help in detecting fraud? Before we understand that, let us look at the main reasons why online payment and conversational AI chatbots are more prevalent today.

Reasons why consumers prefer online payment?

A report by?Business Wire?suggests that mobile payments are projected to cross $12,407.5 billion by the end of 2025, and the CAGR between 2020-2025 is expected to be at 23.8%.

The quick access to a mobile app, integrated UPI platforms and various payment facilities have increased the demand for online payment systems. Still, the increasing risk of fraud has demanded the need to apply chatbots for fraud prevention.

The main reasons why consumers prefer online payment today are:

·??????Eliminate the limitation of geographical boundaries.?

·??????Access to the online platform is convenient and quick.?

·??????Transact with a business without waiting in queues, which saves time.

·??????The highly encrypted and advanced technologies used by banks for safe transactions.

·??????Contactless payments are a lifesaver in times of uncertainty like a pandemic.

·??????Voice payments are quick and easy. Around 28% in the USA are using voice payments, suggests?Capgemini.?

·??????The application of biometric authentication has endured the dual security check.

·??????For the flexible shopping experience, mPOS (mobile point of sale) is a boon with an expected growth of a CAGR of?19%?from 2020-26.

Benefits of conversational AI chatbots in banking

Conversational AI in banking?is soon becoming a preferred method of communication.

The fraud detection using conversational chatbots is quick. The system can analyze malpractices or deviations and warn the customer in time. Using the conversational AI-based?chatbots in the banking?industry offers multifold benefits such as:

Quick and seamless conversation

The chatbots are available 24*7 and trained to interact in multiple languages, which reduces the burden on the customer support staff while improving customer loyalty.

Ease of payment acceptance

AI chatbots can share the authenticated number or email links for seamless and quick payments that improve the transaction quality.

Reliable and secure

Fraud detection using AI is reliable. Being trained on past data, the AI can ensure a higher degree of privacy and security by encrypting and checking the transaction.Using the integrated AI-based chatbots, customers can have an omnichannel experience that improves customer satisfaction as it carries?forward context from one channel to another.

Why should we focus on fraud prevention?

The banking industry involves the use of financial transactions. It is one of the primary and sensitive industries; a single fraud incident can cause huge losses. The monetary loss aspect is there, but it also involves the impact on goodwill and reputation.

75 per cent of businesses?have stated that security is a priority for them (as it should). Banks and financial services can increase their?security?easily by using chatbots.

How to use AI chatbots to fight fraud?

Per statistics, around?61% of fraud losses in banks?and financial services are due to identity fraud. So, it is essential to know how can AI can help in detecting fraud? Here are the most prominent ways of fraud detection using AI:

Setting up the alerts

The automated system powered by AI can detect the hacking of cards or accounts and help with fraud detection.?A quick verification message shared by the chatbot in such a situation can be handy and save loss.

Analysing the trends

AI can analyse the details and?pattern?of transactions in an account. While doing so, it can confirm any similarity to the factors that point out towards the fraud. It is where one can use AI chatbots for fraud prevention to communicate to customers for transaction confirmation.

Let’s understand this with an example. Someone has hacked a user’s account and have their log in details. They start conversations with this detail but later in the conversation, they encounter question verification or two-factor authentication to which they don’t have answers. Further, AI can detect a deviation in the writing profile or the usual IP address of the user. With this info, AI can detect frauds.

Resolution at the earliest

Conversational chatbots provide quick help. The time a customer needs to wait on the chatbot to file a fraud-related complaint is negligible. Also, the quicker the query is listed, the better and faster the resolution.

Real-time support and analysis

The fraud detection using AI chatbots works 24*7. It means that if there is any suspicious activity in the account or card, the system is trained to block the same temporarily and alert the user.

Secure and personalised experience

The most crucial part is that chatbots offer a personalised experience. The chatbots for fraud prevention move a step ahead to provide the services to the customer based on their transaction history, creating a secure and personalised experience.

Biometric authentication

AI-powered chatbots with voice and facial recognition technology add another layer of protection. When a user uses the voice feature, the chatbot can compare it with the user’s voiceprint from previous notes. If it doesn’t match, it can alert the user and the bank. And all this happens in real-time.

Chatbots are revolutionising the financial industry in various ways

The integration of AI chatbots in the financial sector is expected to save around $2.3 billion by 2023, suggests?Juniper Research. Changing the service industry and offering a smooth base for financial transactions, we will see an exponential use of chatbots in the financial sector.

Fraud detection using chatbots is one great aspect of the technology revolution in the financial industry.?63%?of financial institutes are already using a combination of rules and ML embedded in their technology to facilitate fraud detection.Online retailers are also looking for ways to improve the shopping experience by making it easier for customers to access the information they need. Many are now using “chatbots” automated systems that can answer questions in a text chat window on the website.

Initially chatbots are pretty dumb – they can only answer specific questions, which have to be worded exactly right or the system doesn’t understand. But when backed by AI, the system becomes much cleverer.AI can be used to “learn” how customers think, and to answer vague questions. The more the system learns, the more questions it can answer, more quickly.

When people think of talking to an AI chatbot, they’re likely expecting an awkward and unpleasant experience. That’s because for a long time, chatbots weren’t powered by an AI system, but were a simple question-and-response system.They had a limited amount of responses for common questions and were unable to answer inquiries they weren’t prepared for. They were limited, robotic and never felt alive. You could ask the same question three times and get the same answers every single time.

While the first forays into AI chatbots have only proven a little better, the technology is improving rapidly. Depending on how deep into a conversation the chatbot has to go, it’s quite possible for users to never even know they aren’t talking to a real person. If you were to ask a more advanced chatbot today the same question three times, it would likely try different response methods to make sure you got the answer you want. It would request clarifying questions to ensure that you understood its answer.

With the right interactions and programming, it’s possible to?build your AI a distinct personality?to better meet your needs. That could include using specific words, taking specific approaches, using specific conversation starters, or even using things like memes or emojis.Then, as the AI learns more, that personality can grow and change to better match those they are talking to. That could mean multiple personalities for different scenarios, such as different genders, types of customers, how many times they have talked to the AI, and more.

Are you & Your Business/Organization Ready for Chat Bots

Just because the technology is available doesn’t always mean it’s right for your business. Don’t just jump on the chatbot bandwagon because everybody else is; instead, make sure it has a clear purpose within your business strategy. If your business has very little chat or email conversations with your leads or customers, it won’t make sense to do all the work to include a chatbot in the process.

But if you do have a constant need to interact and talk with leads and customers, and are struggling to satisfy that need, an AI chatbot might be exactly what you need. They can boost productivity, fit nicely into most parts of a marketing funnel, and handle the basic requests your business gets flooded with. Then, as needs arise, qualified leads or harder customer cases can get forwarded to real people trained to handle the situation.

Another point you have to consider is who will be managing any chatbots you bring into your business. You’ll either need to hire somebody to manage the system and keep it up to date, or pay a service to do it for you. Where you might be saving money replacing a few customer support reps or salespeople, that money might just go straight to purchasing and upkeep costs for the chatbot.

Legal issues

The main problem with chatbot privacy is that bots are not so smart as we expected.For example, if a chatbot has to identify someone, it needs to collect a quite wide amount of personal data, which conflicts with the principle of?data minimization(“the less you ask the better”) of the European General Data Protection Regulation (GDPR).Customer profiling is another activity at the edge of legality. The bot needs to analyze and combine large sets of personal data, which collides with the chatbot privacy principle of?purpose limitation.The rule of purpose limitation states that personal data may be used only for a specific goal. This set a rigid limit to any data drilling.

Other limits come from the ban on?sensitive personal data collection?(like ethnicity, religion, health) and the obligation to process data in transparently.Unfortunately, artificial intelligence cannot be transparent, as in some ways it is opaque even to the software developers that built it.Last, people have?the right to object to the use of their personal data, and they may ask the deletion. Respecting chatbot privacy means then also to safeguard these two rights.

Another issue of chatbot privacy is that most organizations do not have the ability to process data or manage the complex functioning of bots.The most popular solution is to outsource the whole process of chatbot building, managing, and maintenance. Unfortunately, giving the job to a specialized IT company does not release an organization from legal liability, according to privacy law.This creates a bad situation under the profile of chatbot privacy: the organization is still liable for privacy violations, even though the violations have been committed by a third company on which the organization has no power.

You Tube Stuff & Some Free Links/Softwares that teaches you how to create a Chat Bot

Links :

Conclusion Well personally i had the privelage to use a Chat Bot Software for merely 2 hours in a training session for setting up AI response systems for one of the SAP Cloud Environment which was a brilliant experience, So if you ask me, I would love to use it but be careful of the consequences & its precarious uses.

Disclosure & Legal Disclaimer statement?Some of the Content has been taken from Open Internet Sources just for representation purposes.

Anjoum Sirohhi

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