Banking on AI: How cloud and AI are transforming banking

‘Cora, what is my balance?’, you ask your smart assistant. The revolution in the smart home with solutions such as Amazon’s Echo Alexa or Google Home are set to revolutionize the way customers and banks interact. João Marques Lima reports.

This article originally appeared in the last issue of the Data Economy Magazine. Click here to read more.

Walking into a bank may soon be something of the past as most institutions work on advancing their digital platforms to answer the real time needs of their customers.

Speed is a key attribute here, however, in the digital era there are still some challenges to overcome, especially within the banking sector, which very much sits on legacy infrastructure and slow-moving upgrading projects.

But for one bank, the journey towards the next level of digital modernization is at full steam with the adoption and enlargement of cognitive computing capabilities that will ultimately change how customers interact with the bank.

“Banking is very traditional, mainframe based, slow developments, things take years and years to get build out,” says Adam Shardlow, Journey Lead, Digital, Personal & Business Banking at the Royal Bank of Scotland (RBS), who has previously spent nearly five years at Amazon.

“Banking comes from a sort of background where they have their own terminology and they kind of assume that their customer base knows what they are talking about, and that is just not true.”

Yet, despite the infrastructure barriers, banks, and in this case RBS, are finding their way through.

One of the most ambitious digital projects RBS is currently undertaking is the creation and launch of a chatbot capable of helping clients in real-time, 24/7.

Named Cora, the artificial intelligence virtual assistant is underpinned by technology provided by IBM including its Cloud Platform (former Bluemix) and its flagship cognitive computing software Watson.

“We have our Watson platform, and we don’t call it AI, we call it augmented intelligence,” says Helen Kelisky, VP, IBM Cloud UK & Ireland.

“We do see it as the way to help companies and government, public sector agencies make better decisions.

Because there is so much data, what do you do with it? You need stuff like augmented intelligence; you need to drive data insights to help you make business decisions.”

Watson leverages machine learning techniques to lower the barriers of entry to business development, making the process of launching a service faster than previously has been.

“Using the IBM Watson and IBM Cloud, we were actually able to set up a team in the innovation area of the bank that worked very quickly to develop the chatbot,” Shardlow explains.

“We then got that up in front of customers and we started then iterating very quickly. We found that customers were utilising the solution itself.

“For the first time ever, what we have been able to introduce was a single channel, a single front door that customers could utilise that actually allows us to capture data across of all the different parts of the bank and then start utilising that to understand what our customers are asking, which RBS never had up to that point.

“The information was there, but it was very unstructured and you had to go away and stick it all up together, and cellotape it to get a really good in depth understanding.”

A crucial part of the RBS’ digital journey, is like in any other business, getting the board to back and approve the development of such novel ideas.

Nevertheless, the times that we are living dictate that businesses have to be faster at making such decisions, are also becoming easier as the technology matures, the need to have it augments and trust develops.

Shardlow said: “All of the financial services are going through massive digital change and they all know that the ways of working that have been in place for years with financial services companies just won’t work going forward.

“This [Cora] project is just one ofmany projects that are happening.

The bank itself is becoming very digital first, we are becoming mobile led, more and more of our customers choose that way to interact with the bank.

“While there were lots of discussions and there was plenty of discussion around why we were introducing something [like Cora], you still want to make sure it gives the customer the best service possible.

It was not as hard a conversation that would perhaps have been if we tried to do something like this three or five years ago.”

Looking into the near future, Shardlow says that RBS will be further leveraging IBM Watson and Cloud Platform to move Cora into its second phase moving Cora form just being a chatbot “very much focused on help and support” to a more transactional AI assistant.

“What we are looking to introduce more in 2018 is starting to get more of the transaction pieces, so customers can actually start asking how much they’ve got in their balance, what transactions they’ve had, etc.

We are seeing customers wanting to interact with this at a much more micro level.

“Banking was always traditionally about you going in and asking your banking manager for something. It is your information, we should be pushing it to you, making it as easy as possible for you to access.”