# Artificial intelligence and financial services – the perfect match? Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2017-10-12 Category: TECHNOLOGY Category URL: https://financedigest.com/category/technology Meta Title: Unlocking the Potential of AI in Financial Services Meta Description: Discover how AI can revolutionise the world of banking, providing unparalleled insight from data and unlocking business benefits. Learn more here. URL: https://financedigest.com/artificial-intelligence-and-financial-services-the-perfect-matchhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/fd121017-10-1736843385184-compressed.jpg) The last decade or so has seen a number of technology waves, such as the cloud and mobile, that have really transformed Financial Services (FS), changing the way banking is done forever. But perhaps the biggest impact from technology is yet to come. Artifical Intelligence (AI) is a technology term that has been much debated and discussed, especially over the last 18 months, but it is yet to truly show its full potential. ![Dorian Selz](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/dorian-selzceosquirro-211x300-1736843385130-compressed.png) Dorian Selz In fact, technology is a sector that has often been prone of over-hyping the [latest trends](https://www.financedigest.com/truck-mounted-concrete-mixer-market-size-top-key-players-latest-trends-regional-insights-and-global-industry-dynamics-by-2022.html "Truck Mounted Concrete Mixer Market Size, Top Key Players, Latest Trends, Regional Insights and Global Industry Dynamics By 2022") that emerge within it. The fact that industry analyst [group Gartner calls](https://www.financedigest.com/soccer-womens-rights-group-calls-on-fifa-to-kick-iran-out-of-world-cup.html "Soccer-Women’s rights group calls on FIFA to kick Iran out of World Cup") one of its market analyses the ‘Hype Cycle’ further highlights the tech industry’s propensity for hype, and AI certainly falls into that category. Despite the [media attention](https://www.financedigest.com/inskin-media-makes-a-number-of-strategic-hires-as-it-furthers-its-mission-to-maximise-attention-and-impact-in-digital-campaigns.html "Inskin Media makes a number of strategic hires as it furthers its mission to maximise attention and impact in digital campaigns") how many firms within FS can honestly say that they are deploying AI within their organisation and seeing genuine business benefits from it? But AI certainly comes with enormous potential. It can offer an FS firm incredible insight and analytic power, and is a technology on the radar of the world’s [biggest and smartest businesses](https://www.financedigest.com/truic-evaluates-the-biggest-business-incorporation-companies-in-the-us.html "TRUiC Evaluates The Biggest Business Incorporation Companies in The US"). A recent (July 2017) report from the McKinsey Global Institute Study, [Artificial Intelligence](https://www.financedigest.com/machine-learning-in-artificial-intelligence.html "Machine learning in artificial intelligence"), The Next Digital Frontier, revealed that tech giants including Baidu and Google spent between $20B to $30B on AI in 2016, with 90% of this spent on R&D and deployment.So how can FS organisations make best use of AI and ensure it truly delivers on its potential? **Utilising data** The one thing that can really help AI emerge from the hype, is simple – data. FS organisations hold more data than ever before, and thanks to the [Internet of Things](https://www.financedigest.com/iomt-internet-of-medical-things-to-accelerate-the-intracranial-pressure-monitors-market.html "IoMT (Internet of Medical Things) to accelerate the Intracranial Pressure Monitors Market") and the connected world we live and work, this data is growing all the time. Used effectively, [data can deliver unparalleled insight into an FS firm’s](https://www.financedigest.com/financial-services-firms-turn-to-big-data-intelligence-to-fight-fraudulent-activity-according-to-xerox-study.html "FINANCIAL SERVICES FIRMS TURN TO BIG DATA INTELLIGENCE TO FIGHT FRAUDULENT ACTIVITY ACCORDING TO XEROX STUDY") customers and more, but it has been a challenge until now for organisations to manage this data in a way that enables easy extraction of actionable insight. The answer lies with AI and machine learning (ML). But before AI and ML can get to work, a big issue for many organisations, is the manner in which data is stored. It [isn’t uncommon for a bank to store and manage](https://www.financedigest.com/good-management-isnt-a-click-measuring-contest.html "Good management isn’t a click-measuring contest") data in multiple CRM platforms, as well as a number of other repositories – ERP, other databases, on the server and on desktops – across the organisation. This can arise through M&A activity, expansion or simply inefficient managing of IT resources, but the end result is the same – data held in many siloes. This makes the management and analysis of this [data a much harder job](https://www.financedigest.com/euro-zone-bond-yields-rise-after-u-s-jobs-data.html "Euro zone bond yields rise after U.S. jobs data") than it need be. If you cannot access data than how can you be [expected to draw insight](https://www.financedigest.com/robo-taxi-market-expected-to-witness-a-sustainable-growth-by-2030-tmr-insights.html "Robo-Taxi Market Expected To Witness a Sustainable Growth by 2030 – TMR Insights") from it? **Unstructured data in FS** Furthermore, the sheer volume of big data in modern FS organisations can be bewildering, and it comes in files and formats that most CRM [systems are unable to manage](https://www.financedigest.com/energy-management-system-market-to-register-a-cagr-of-14-8.html "Energy Management System Market to register a CAGR of 14.8%") effectively. Unfortunately, this data is often the most valuable, containing rich insight into aparticular customer and their specific needs and requirements. This unstructured data includes: any social content – Twitter, Facebook, LinkedIn, Instagram – by, and relating to that customer; email conversations between the customer and bank; service [call scripts that detail any recent or historical issues](https://www.financedigest.com/uk-issues-call-to-arms-for-omicron-booster-drive.html "UK issues call to arms for Omicron booster drive"), and much more besides that doesn’t into the formats used by most CRM systems. By not deploying unstructured data within a CRM, it can potentially be a major problem in FS, with huge swathes of potential customer insight missing. Utilising technology that captures both structured data in siloes and the masses of unstructured data, means FS organisations can really begin to benefit from AI. **How AI can benefit FS** Used properly, AIcan have a genuine and tangible [impact on any business and its customers](https://www.financedigest.com/impact-com-fiscal-year-h1-2021-1-5b-valuation-150m-in-funding-bigcommerce-integration-69-customer-growth.html "impact.com Fiscal Year H1 2021: .5B Valuation, 0M in Funding, BigCommerce Integration, 69% Customer Growth").For instance, enterprise search is an area that is crying out for the use of AI and ML. Knowledge [workers in FS are spending](https://www.financedigest.com/starbucks-projects-profit-growth-from-tech-stores-workers-spending.html "Starbucks projects profit growth from tech, stores, workers spending") too long searching for information that might not even be filed where they are searching for it. Using an AI-based cognitive system allows much more complex search queries and can even make [relevant and contextual](https://www.financedigest.com/gumgum-and-frameplay-partner-to-deliver-contextually-relevant-intrinsic-in-game-advertisements.html "GumGum and Frameplay Partner to Deliver Contextually Relevant, Intrinsic In-Game Advertisements") suggestions back to the user. This is AI effectively understanding better than the user what that user is looking for, saving time on searches and [delivering better results](https://www.financedigest.com/uk-pm-sunak-election-results-show-people-want-us-to-deliver-for-them.html "UK PM Sunak: Election results show people want us to deliver for them"). AI can also deepen customer understanding. An issue for larger FS [firms is knowing who holds](https://www.financedigest.com/oil-prices-hold-firm-amid-hopes-for-economic-growth.html "Oil prices hold firm amid hopes for economic growth") which relationships at a particular customer. A customer may have been contacted by many different individuals, in different parts of the [business and even the world](https://www.financedigest.com/world-bank-scrapping-ease-of-doing-business-index-is-a-reminder-to-focus-on-fundamentals.html "World Bank scrapping Ease of Doing Business Index is a reminder to focus on fundamentals"). AI technology can look at mases of unstructured data – all emails sent to an organisation, from and to different people, in different departments and locations – and provide a way for a user to take meaningful action with a customer. This outlines clearly and in real-time who knows who within an organisation, invaluable when enterprise relationships can be so complex. These are just two examples – the potential of AI can go much further than that and over the [next few years](https://www.financedigest.com/musk-says-tesla-will-launch-prototype-of-humanoid-robot-next-year.html "Musk says Tesla will launch prototype of humanoid robot next year") will transform many elements of FS. But the key to taking AI [beyond the hype](https://www.financedigest.com/beyond-the-hype-metaverse-and-the-future-of-financial-services.html "Beyond the hype – metaverse and the future of financial services ") lies with data, that’s where the potential is at its richest. By deploying AI and ML, organisationsin FS can collect data from multiple sources and in multiple formats, extracting fresh and [insightful meaning from it and helping to deliver](https://www.financedigest.com/research-delivers-insight-into-the-global-polymer-surfactants-market-during-the-period-2021-2029.html "Research Delivers Insight Into The Global Polymer Surfactants Market During The Period 2021-2029") a complete view of that customer. Dorian Selz is CEO and co-founder of contextual insight firm, [Squirro](http://www.squirro.com) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---