It seems you can’t go anywhere today without artificial intelligence (AI) creeping into the conversation. Billed by some as being as, or potentially more disruptive than the internet, AI and machine learning (ML) are laying the foundation for the next digital age, whether we’re ready or not.
Bankers are taking note. According to a survey from The Economist Intelligence Unit, 77% of bankers believe that the ability to unlock the value of AI will be the difference between winning and losing banks. And there are many obvious use cases for bankers to up their game with AI including:
- Account inquiries – employing chatbots to provide updates on account balances, transaction history, and other account-related information
- Credit score monitoring – AI-enabled assistance for customers to check their credit ratings and advice on how to improve them
- Fraud prevention – training AI models to detect fraudulent patterns and behaviors
- Customer service – deploying chatbots to provide real-time customer care by answering common questions and addressing simple issues
- Investment guidance – real-time, personalized investment advice leveraging AI to provide targeted assistance based on consumers’ specific preferences and risk tolerance
But it’s not all sunshine and unicorns as they say. AI is also being adopted by cybercriminals of all shapes and sizes at an alarming rate, straining traditional cybersecurity paradigms. AI’s automation prowess is a double threat – increasing the scale of attacks, while also lowering the required skill level and resources to be able to execute attacks. And banks are seeing the impact firsthand. U.S. banks reported a 43% increase in fraud attacks year over year, with the average cost of fraud for large financial institutions jumping by 65%.
Deepfakes and synthetic identities represent two of the most nefarious challenges to banks and credit unions who are seeking to prevent fraudulent account openings and takeovers while also complying with eKYC (electronic Know Your Customer) regulations. An added challenge is to apply an extra layer of security AND improve the customer experience. For account opening this starts with AI-enabled document validation and biometric identity verification using the customer’s mobile phone. This ensures the document is a valid form and instance of the credential, and that the person presenting the identity credential is the owner of that credential. Once verified, the customer provides a digital signature to accept the terms and conditions and presto! – a digital payment credential is issued securely, all in a matter of minutes!
Once the account is opened, AI and ML also play a critical role in helping the financial institution model and detect fraud, plus enhanced risk-based authentication with behavioral biometrics helps identify fraudulent patterns and unauthorized users early.
Learn more about securing the customer’s digital journey from account opening and onboarding to credential issuance and transacting.