How generative AI is entering the conversation in banking

By Stewart Bowling, Courtney Hoff Dockerty

November 21, 2023 2:48 PM

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Senior banking leaders are very much aware of and interested in the potential of generative AI to have a big impact on the industry, some enthusiastically so. But while no one wants to get left behind, there's also no great urgency to be the first mover.

Read more about how the industry is responding to generative AI in our roundup of stories on the new technology.

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Confidence tempered by reticence guides banking approach to AI

Cautious optimism may be the way of summarizing the views of senior leaders on the use of artificial intelligence and generative AI in banking, with a range of views being expressed, and questions asked, at the FinovateFall fintech showcase.

"We are exploring advanced AI and large language models currently," said Jill Castilla, CEO of Citizens Bank of Edmond. "There are many use cases, and we believe that generative AI has the ability in the industry to help anticipate and predict client needs in a sophisticated way."

At the same time, like many of her peers, Castilla is looking for answers on how to best implement AI: "When we talk about AI, it's about, how does AI enhance the experience, not replace the experience. How do you keep that genuineness while leveraging the AI?"

Read more:

Bankers are open to generative AI but list several reservations

No letting the grass grow under one’s feet for Ally Bank

When it comes to implementing generative AI, time is of the essence for Ally Bank, which launched a pilot at the end of June for its first use case, little more than six months after ChatGPT hit the streets.

Ally.ai, the bank's cloud-based platform, which utilizes AI to transcribe contact center calls in real time, thereby freeing agents from multitasking and allowing them to focus on the client conversation, has already been deployed to more than 700 customer service reps.

"This has the potential to unleash productivity for us," said Sathish Muthukrishnan, chief information, data and digital officer at Ally Bank, who hopes to expand the platform with further use cases.

Read more:

Ally Bank's foray into generative AI: 'We don't want to stand still'

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Fintechs speed ahead with AI, while banks go slowly

Fintechs are breaking new ground with generative AI every day, but for banks thinking of using the new technology, measured advancement rather than rapid implementation is the order of the day, according to capital markets research firm PitchBook.

"It's going to accelerate, but it's also probably still going to be quite slow in the near term," said Rudy Yang, a senior research analyst at Pitchbook.

Banks are more than likely going to take their time. "Companies just want to be really diligent when they're exploring this technology," said Yang. "They want to make sure that they get it right."

Read more:

Fintechs experiment with generative AI, but development is slow going

Banks turn to cloud giants on generative AI

When billions of dollars have been poured into technology like artificial intelligence and generative AI by Microsoft, Google and Amazon Web Services that could radically change the industry, banks are bound to be taking a keen interest.

"In almost every conversation that I've had over the last six months with a leader in any financial services organization, generative AI has come up as a topic," said John Kain, head of financial services market development at AWS.

While the three cloud computing vendors are in heated competition, the motivation for banks is clear enough, too. "Our customers see how transformative this could be and none of them want to be left behind," said Kain.

Read more:

AWS, Google and Microsoft are in an AI arms race. Banks are watching.

Synchrony moves cautiously into the AI universe

Carol Juel, chief technology officer and chief operations officer at Synchrony, is heading a digital evolution at the bank, spending billions of dollars and developing technology through hackathons, incubators and accelerators.

Synchrony had their first generative AI hackathon this year, where teams came up with various ideas including using generative AI to assist customers with selecting products through a marketplace and in customer service.

Juel is still wary of the risks of generative AI. "Anything you put into it is part of the model," she said. "Therein lies the risk. So by accident, someone sharing something that is either intellectual property or confidential client data, then it becomes part of the large language model.

Read more:

How Carol Juel is leading Synchrony through the hazards of generative AI