Why India’s financial services sector is bullish on artificial intelligence

Top IT decision makers in the Indian banking, financial services and insurance (BFSI) sector believe they need to adopt artificial intelligence to carry out their business objectives, a joint report by industry body NASSCOM and advisory firm CyberMedia Research (CMR) stated.

A survey conducted by CyberMedia Research found that 74% of decision-makers in BFSI feel that they can use AI to provide proactive and personal customer support, which is their primary business objective, Anil Chopra, vice president of research and consulting at CMR, said in a media statement.

“The BFSI sector is very positive about using AI. However, choosing the right AI offering from different vendors is still a major challenge due to lack of common standards or frameworks to guide them through it,” Chopra added.

For their second highest business objective, decision-makers said that automating back-end business processes would reduce human errors and improve turnaround time, the statement said.

Using AI for marketing to track consumer behaviour and security and compliance were the third and fourth business objectives, respectively.

One measure that the BFSI sector will implement in the next six months to a year is to deploy AI-based fraud detection and prevention tools and chatbots/voicebots for customer support.

“Today, Data Science and AI have made it possible to comprehend and utilise complex data into insights that help with decision making. Realising this potential, organisations are prioritising AI as an area to expand upon. As this adoption increases, data security and compliance with laws should be pushed up the business priority ladder while mapping organisational objectives with AI,” Debjani Ghosh, president at NASSCOM, said in the statement.

Public and private sector banks are already implementing AI and other technologies such as blockchain and machine learning, all in order to cater to customer needs.

In an interaction with TechCircle last month, Deepak Sharma, Kotak Mahindra Bank’s chief digital officer, said that the lender is using robotic process automation and optical character recognition to streamline its internal processes. He also said that the bank plans to use AI, ML, big data and analytics for risk management and fraud detection.

HDFC Bank too is deploying emerging technologies such as digital assistants, robots as well as Facebook Messenger-based bots in its branches to improve customer experience. In an interview with TechCircle in May, Nitin Chugh, the lender’s country head for digital, said that the bank has been using AI for two years not only aimed at its customers but also to streamline internal processes. To develop better communication with its customers, HDFC Bank has developed two chatbots, IRA and Eva, with help from startups Niki.ai and Senseforth Technologies, respectively.

In April, public sector lender State Bank of India partnered with South Africa-based digital infrastructure company Dimension Data to set up digital branches for enhanced customer experience for its advisory and banking services.