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AI, Banking, Featured

Role of AI and ML in Customer Acquisition and Customer Retention in Banking

Critical decisions taken by banking authorities are made easy with the implementation of high-end technologies in amalgamation. AI, ML, and Big Data come together to simplify complex decision-making. 

Also Read: The Amalgamation of Blockchain and Machine Learning to Disrupt the Industrial Future

Maximizing Profits and maintaining a strong base of valued customers through efficient customer service are the two main goals of any banking organization. Data analysis has traditionally been the core of banking. Business line managers go through grinding blocks of numerics, daily,  to figure their position concerning revenue inflow and outflow patterns, risk indicators, and operational efficiency. This type of banking was regarded as acceptable and sufficient a few decades back. But the scenario of today’s aggressive and demanding business environment has surpassed the scope for simple analysis.

With the increasingly convoluted scenarios, the proliferation of data, cut-throat competition, and higher stakes, banks require greater control and better evaluation with regards to product portfolios from the perspective of operations and risk analysis.

Technology has enabled faster and cleared communication between customers and banks. The process, however, has heightened the risk quotient for banking. This has made ground for banks to have automated processes based on systems that are scalable, time-variant, and capable of analyzing huge volumes of data. The goal of such systems should be maximizing profits while minimizing the risks and keeping the business-line managers in the loop to enable them to make informed business decisions.

Machine Learning (ML), Artificial Intelligence (AI) in amalgamation with Big Data technology provide the very platform that can deliver such large-scale analyses and predictions. 

Also Read: Can Blockchain and Artificial Intelligence Prevent Future Pandemics?

The Data analytics approach applied to banking processes, target maximizing returns from assets while minimizing or balancing the liabilities.

Similarly, a profit and loss approach targets maximizing the number of accounts and maintaining their quality, and thus, improving the bank’s margins.

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