As banks pursue a renewed emphasis on digital customer experience, many are working with fintechs to provide customer experiences on par with large tech companies and innovative startups. AI is taking the technology world by storm, allowing companies to cut costs, automate processes and boost their bottom lines. For financial institutions to enjoy the same benefits from AI, they need to first address a multitude of issues. These include: cultural alignment, upgrading legacy systems, eliminating data silos, staff training and talent acquisition, cloud strategy, internal or open source technology, and security and privacy.

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The Sun is Shining, So What’s Next?

Once these are addressed, the opportunities are endless. Robo-advisors can provide the same index fund weighting and portfolio diversification without the overhead or human error potential. Using AI to replace analysts, back-office operations, and even research teams can reduce costs and improve productivity. AI can be used to monitor regulatory compliance to ensure adherence to thousands of regulations in real time. And AI can help banks automate repetitive processes and potentially improve the customer experience. Today, AI-powered chatbots are being used as virtual assistants, customer care representatives, marketing executives, and salespeople.

One of the most valuable benefits AI brings to financial institutions is data. The future of fintech is largely reliant on gathering data and staying ahead of the competition, and AI can make that happen. With AI comes huge volumes of data which will, in turn, offer game-changing insights. These insights can be used to create reports that not only increase productivity and revenue, but also help with complex decision-making processes.

No business can survive by simply satisfying its customers–companies have to deliver on the brand promise and delight customers with every interaction. Financial institutions need to work in a customer-centric culture that strives to create frictionless consumer experiences like those that have made fintechs like Transferwise, Zelle, and Betterment so successful. Banks can also learn from what fintechs have been doing for years. This includes consistently monitoring customer expectations through open-data exchanges and qualitative feedback, and incorporating learnings into new product offerings and interactions.

There is a sense of commitment and purpose among banking leaders to embrace innovation and leverage technology to develop new business models, build momentum, fail fast and learn from failures. The good news is that financial institutions are embracing openness and collaboration and making smart investments in fintech.