Michael Araneta, associate vice-president for IDC Financial Insights addressed this topic at the recent Asian Financial Services Congress 2019 in Singapore, where he suggested that new capabilities in financial institutions “will scale so fast that we might not know exactly what to do”.
He cautioned against being sucked into exploring lots of new things simply because that is now possible.
“It does not necessarily mean that these are necessary or that these are things we should be doing,” he said. (For more, read WARC’s report: How Asia’s financial services brands can prevail in the age of AI)
In fact, he sees three key capabilities on which Asia’s financial institutions ought to be concentrating in next 12 months, which he defined as: the ability to love the customer, the ability to simplify and the ability to innovate.
On the first of these, he reported progress in the region as 75% of financial institutions are now able to achieve a single customer view, compared to 70% last year.
“The greater use of analytics’ ability to slice and dice databases to at least understand two things – the transaction behaviour of our customers, and their channel preferences – means the understanding of the single customer view has improved significantly.”
But he highlighted two new areas that financial institutions will need to look at – around identity and consent.
Not only does personally identifiable information have to be protected, but “a set of behaviours which we can infer from based on transaction behaviour, is going to be important”, he said – and this will become part of the conversation on identity.
“Informed consent is going to be a very important principle of how we are going to use automated functions in financial services,” he added, stating that this must form the basis of customer engagement as the industry moves forward.
“We have this once-in-a-lifetime opportunity to define for our industry how artificial intelligence is supposed to be used,” said Araneta. “Ultimately, it has to be pragmatic, responsible as well as customer-centric. It has to be pro-customer.”
Sourced from WARC