An industry-specific guide to the applications of Advanced Analytics and AI to the banking industry Artificial Intelligence (AI) technologies help organisations to get smarter and more effective over time – ultimately responding to, learning from and interacting with human voices. It is predicted that by 2020, half of all businesses will be using these intelligent, self-learning systems. Across its entire breadth and depth, the banking industry is at the forefront of investigating Advanced Analytics and AI technology for use in a broad range of applications, such as customer analytics and providing wealth advice for clients. AI and the Future of Banking provides new and established banking industry professionals with the essential information on the implications of data and analytics on their roles, responsibilities and personal career development. Unlike existing books on the subject which tend to be overly technical and complex, this accessible, reader-friendly guide is designed to be easily understood by any banking professional with limited or no IT background. Chapters focus on practical guidance on the use of analytics to improve operational effectiveness, customer retention and finance and risk management. Theory and published case studies are clearly explained, whilst considerations such as operating costs, regulation and market saturation are discussed in real-world context. Written by a recognised expert in AI and Advanced Analytics, this book: Explores the numerous applications for Advanced Analytics and AI in various areas of banking and finance Offers advice on the most effective ways to integrate AI into existing bank ecosystems Suggests alternative and complementary visions for the future of banking, addressing issues like branch transformation, new models of universal banking and ‘debranding’ Explains the concept of ‘Open Banking,’ which securely shares information without needing to reveal passwords Addresses the development of leadership relative to AI adoption in the banking industry AI and the Future of Banking is an informative and up-to-date resource for bank executives and managers, new entrants to the banking industry, financial technology and financial services practitioners and students in postgraduate finance and banking courses.
Author(s): Tony Boobier
Publisher: John Wiley & Sons
Year: 2020
Language: English
Pages: xx+284
AI and the Future of Banking
Contents
Acknowledgements
About the Author
Introduction
1 Prologue: Why Banking?
Summary
Introduction
What Is Banking?
What Do We Mean by ‘Money’ Today?
A Cashless Society Increasingly Emerges
Key Banking Functions
Future Jobs in Banking
Conclusion
References
2 Imperatives in Banking
Summary
Introduction
Strategy and Imperatives
Strategy
Business Imperatives
Current Imperatives in Banking
Comparable Imperatives in the Retail Industry
Comparable Imperatives in the Telecoms Industry
Comparable Imperatives in the Healthcare Industry
Future Imperatives in Banking
Greater Customer Centricity
Becoming Truly Digital
Completely Accepting Technological Change
Reimagining Banking
Reinventing Risk Management
Conclusion
References
3 Data and Analytics Primer
Summary
Introduction
Data Management and Analytics
Data Management
The Hierarchy of Analytics
‘Next-Generation’ Cognitive Analytics
Extracting Value from Data
The Importance of Location Analytics
Conclusion
References
4 Key Elements of Banking Analytics
Summary
Introduction
Office of Finance Management
Performance Management and Integrated Decision Making
The Key Elements of Banking Performance Management
Customer Analytics
Customer Insight
Credit Ratings
Branch-Specific Campaigns
Impact of Social Media Campaigns
Relationship Pricing
Client Servicing
Risk Management
Risk Scenario Analytics
Fraud Detection
Regulatory Compliance
Risk Management and AI
Operational Efficiency
IT Cost Transparency
Branch Performance Management
Contact Centre Service
Payments Monitoring
Mortgage Tracking
Sales, Compensation and Commission Management
Financial Markets Risk and Trade Monitoring
Analytics in Portfolio Management
Derivative Markets
Conclusion
References
5 Machine Learning, AI and ‘Apps’
Summary
Introduction
Theory and Practice of Machine Learning
Apps and Their Usage
Data Visualisation
Voice Recognition and Voice Assistants
Visual and Facial Recognition
Thumbprint Recognition
Palm Vein Recognition
Wealth Management Systems and Apps
The Biometric Moral Argument
Conclusion
References
6 AI and the Importance of Brand in Banking
Summary
Introduction
Brand Value and Equity in Banking
Millennial and Gen Y Brand Expectations from Bank Brands
Branding Expectations of Generation Z
Branding Expectations of Generation X
Branding and Customer Experience Interlocked
Branding and Human-Centred Design
To Brand or to Debrand?
Banks Will Use AI to Become Lifestyle Managers
Consumption and Credit Smoothing
Conclusion
References
7 AI Leadership and Employee Transformation
Summary
Introduction
Leadership in an AI-Infused Age
Augmented Leadership
Analytically Infused Leadership
A New Approach to Leadership: ‘Trust but Verify’
Attributes of AI-Infused Leaders
Leadership Training for the Future
‘Digital Future of Banking Requires a New Leadership Model’
Zen and Leadership in Banking
Functional Change and Role Transformation
The Evolution of the Banking Employee
A Banking Employee Persona in 2050
Conclusion
References
8 The Bank of the Future
Summary
Introduction
Branch Makeover
The Emergence of the Café Bank
Millennials Not Happy with Dealing Only with Robots
Virtual Reality: Banking and Gaming Converge
Universal Banking and Beyond
Universal Banking in the United States
Banks as the Catalyst for Change: ‘Peer to Peer’
Payment Processes Become More Customer Centric
Five Scenarios for the ‘Bank of the Future’
The Full-Service Bank
The Digital Bank
The Disaggregated Bank
The Conversational Bank
The Collaborative Bank
Transformation of the Investment Bank
Conclusion
References
9 Open Banking and Blockchain
Summary
Introduction
Setting the Stage: Open Banking
Interlock between AI and Open Banking
Blockchain: Setting the Stage
Interlock between Blockchain and AI
Blockchain in Banking
Interbank Market
Forex Market
Investment Banks and Blockchain
Blockchain in Indian Banking
Blockchain and Open Banking in Africa
Conclusion
References
10 Innovation and Implementation
Summary
Introduction
New Roles and Responsibilities
Bootcamps, Hackathons, Innovation Labs, and Other Devices
Implementation
Innovation or Adaptation?
The Use of ‘Design Thinking’
Finding Capital to Innovate: One Example
Fintech for Banking
Blockages to Innovation
Conclusion
References
11 Cybercrime and IT Resilience
Summary
Introduction
Cybercrime in the Context of Operational Risk
The Internationalisation of Cybercrime
Cyber Security Toolkits
Cyber Risk Management Apps
Broader Cyber Issues for Banking
Safeguarding the Bank of the Future: New Cyber Security Threats
Responding to Cyber Attack
Cyber Readiness
New Cyber Roles, New Cyber Responsibilities
AI Fraud Detection in Banking
Advanced Analytics in Fraud Detection
AI and Anomaly Detection
Fraudulent Use of Data
Cyber and the Law
Conclusion
References
12 Epilogue
Appendix: Fintech in Banking
Index
