How Conversational AI Is Empowering Financial Services

Churn remains a significant challenge for financial services, with customers often leaving due to poor service, slow response times, or lack of engagement. Not to mention that trust and credibility are critical factors that push potential investors. 

That's where conversational AI systems come in. They offer a proactive, scalable solution to these issues. By providing instant, personalized support and streamlining client interactions, AI helps financial services keep customers satisfied and engaged. 

Leveraging these smart tools and platforms allows firms to address issues before they escalate, enhancing customer retention and reducing the risk of churn.

The Popularity of Conversational AI in Financial Services

The financial sector has been part of a technological race over the past decade to deploy conversational AI solutions to not just enhance customer interactions by having virtual assistants that can simulate human-like conversations, but also improve their internal operational efficiencies. 

A long list of benefits does underscore the importance of AI in the financial sector, but it also has to do with AI tools and systems becoming more accessible in recent years. This rapid integration can be understood from the fact that more than 75 percent of global banks have deployed some form of AI in at least one of their departments since 2023. 

​With open-source models ready for customization and several market vendors pushing ready-to-deploy solutions, it is now easier than ever for financial and banking services to find scalable, cost-effective conversational AI solutions. 

That’s a single investment to have AI-driven chatbots handle up to 80 percent of all your customer support inquiries without any human intervention, reducing your operational costs by up to 25 percent. It’s why the global AI banking market is expected to cross $130 billion by 2027. 

Benefits That Financial Institutions Can Get From Conversational AI

Providing timely information to clients is just a surface-level benefit for financial services using conversational AI solutions. These systems automate most daily interactions and workflows, even finding quality prospects without any human intervention. 

Personalized Interactions With CRM Integration

CRM systems contain critical data on every customer and client that conversational AI tools can use to personalize their interactions. This goes beyond just an automated greeting that mentions the client by name. The AI takes into account the client's previous interactions, investment preferences, account details, and several more data points to make the interaction meaningful and helpful. 

Automation of Repeated Tasks

Financial services are known to have time-consuming processes. Instead of burning out your staff, let conversational AI handle these routine client requests. It walks clients through document submissions, form completions, account requirements, and other standard processes. 

The technology also processes account balance inquiries, statement requests, basic market information questions, and simple transactions like fund transfers. 

This automation frees broker time for complex tasks while giving clients immediate service for straightforward needs.

Reduced Operational Costs

One of the biggest benefits that financial services get out of conversational AI is reduced cost. When looking long-term, automated interactions cost a lot less than human-handled support. Many businesses are already experiencing substantial labor cost savings by reducing their agent headcounts by up to 40 percent. 

Additionally, do not forget that AI-driven support is always available 24/7. That's efficient customer service without the need for additional hires or extended hours. This results in a more efficient and cost-effective support system, allowing firms to scale without increasing overhead.

Easy Scalability

Conversational AI systems can handle volume spikes without sacrificing quality or performance. For instance, during market volatility or tax seasons when inquiry volumes multiply, the AI maintains consistent response times without additional resources. 

The firm will be accommodating thousands of simultaneous conversations without queuing or delays, before scaling back down to normal when the spike subsides. This capacity eliminates the traditional challenge of staffing for peak periods while avoiding idle time during slower periods.

Intelligent Virtual Assistants to Financial Institutions

Financial brokers equipped with AI assistants gain practical support throughout their workday. These systems prepare client meeting briefs with relevant account information, recent activities, and potential talking points. They provide just-in-time information during client calls, such as product specifications or market statistics. 

Additionally, AI-driven assistants track follow-up items, automatically create meeting summaries, and remind brokers of scheduled actions. This support increases broker productivity and ensures a consistent client experience across the firm.

Conversational AI Use Cases in Financial Institutions

Financial firms have the option to implement conversational AI at multiple touchpoints to address clients' specific needs in their journey. These practical applications create direct benefits for both clients and firms through faster service delivery and reduced manual workload. Here's how:

Assistance in the Onboarding Process

Onboarding can be a bit complicated based on the scale and services of a financial firm. IVAs can help guide new users through their account opening process, ensuring they complete the necessary Know Your Customer (KYC) checks without hassle. 

This includes walking prospects through every step, noting required documentation, explaining unfamiliar terms, automatically verifying information, and flagging inconsistencies. 

Such smart automation reduces abandonment rates and speeds up account creation from days to hours.

Support in Trade Execution

We're not saying that you should let the AI dictate when and where to invest. But you can rely on AI to make informed decisions quickly. 

Many firms are using AI assistants to help clients understand different order types, margin calculations, and trading requirements. Through chat or voice, AI can walk them through executing market orders, limit orders, or stop-loss orders. This significantly reduces trade errors while increasing client confidence in self-directed investing.

Updates on Portfolio Performance

Conversational AI systems deliver portfolio information through natural dialogue instead of complex dashboards. For instance, Charles Schwab's voice assistant answers specific questions like "How did my tech stocks perform today?" with concise summaries. 

Clients receive plain-language explanations of performance metrics rather than technical charts. The system highlights notable changes and connects performance to recent market events. This makes portfolio tracking more accessible to clients who find traditional analytics interfaces difficult.

Efficient Tracking for Market News and Trends

AI provides news alerts based on a client’s portfolio and preferences. For example, it can notify clients of relevant market trends or specific stock movements, helping them stay up to date with news that matters most to their investments.

Customer Service (FAQs)

Conversational AI handles routine inquiries about account details, trading hours, fees, and more. This was previously handled by call center agents who often ended up with backlogs and delays. 

Consider clients who have questions about fee structures and settlement times. Would you have them wait in a queue, or give them the freedom to have all their questions (and more) answered by an AI agent?

In the case of complex or technical issues, the AI can automatically connect clients with human specialists. This approach resolves a large number of support inquiries without human intervention during peak quarters.

Notification Automation to Mitigate Risks

AI sends alerts for margin calls, exposure, or unusual activity.

Proactive alerts help clients avoid costly mistakes through timely notifications. Robinhood's conversational AI system sends warnings when accounts approach margin maintenance requirements. The assistant explains exactly what actions clients need to take and by when. 

For unusual account activity, the system initiates verification checks through natural conversation. This reduces account risks while educating clients about potential problems before they become serious.

Education for the Clients

AI makes financial firms more welcoming to new users. Interactive learning, for example, makes it easier for new investors to understand basic concepts and terms instead of investing blindly. By providing educational resources, firms empower clients to make more informed investment decisions. It also builds investor confidence.

Considerations Before Implementing Conversational AI for Your Firm

Before integrating conversational AI for financial institutions, consider the following key factors to ensure the solution aligns with your business needs and complies with industry standards.

• Data Security: Ensure that the platform complies with financial regulations like GDPR and data protection laws. Secure storage and transmission of sensitive client information are critical.
• Human Fallback: No AI system handles 100 percent of client scenarios. Identify which conversation types require immediate human intervention, and hand them off to human specialists. In addition, give clients the option to speak with a human agent whenever they want. 
• Platform Fit: Assess whether the conversational AI integrates well with your existing systems. A seamless connection with trading platforms, CRM systems, and other tools is essential for smooth operation.
• Accuracy and Compliance: Misleading or inaccurate financial advice can lead to legal issues. Hence, define clear boundaries for what financial information the AI can provide versus what requires licensed professionals. Create verification processes for trade instructions and account changes processed through conversational channels. Have a review process to continuously audit random client interactions to affirm compliance.
• Training and Knowledge Bases: Effective conversational AI requires comprehensive financial knowledge. You need a specialized knowledge base covering all your products, services, and common client questions. Map everything the AI needs to understand, and create specific training for financial terminology and questions unique to financial operations.
• Customer Experience: Ensure that the AI system improves user experience by providing quick, accurate responses. Clients should feel that their needs are being met promptly, even if the AI is handling the inquiry.

How Mosaicx Is Uniquely Positioned to Support Your Conversational AI Needs

Mosaicx is an industry leader that offers tailored conversational AI solutions specifically designed for financial firms. We understand their unique challenges and provide an AI-driven approach to enhance customer experiences, reduce churn, and support growth. 

Our powerful IVAs go beyond traditional chatbots. They offer a natural and secure way for clients to perform transactions, check balances, and get real-time assistance. By automating routine interactions, Mosaicx allows your team to focus on complex issues while ensuring customers receive timely, personalized support. 

As a trusted partner in the financial services industry, Mosaicx is uniquely positioned to help your firm stay competitive and meet client expectations with advanced conversational AI solutions. Schedule a demo today, and see for yourself how our conversational AI technology helps your firm improve both client engagement and operational efficiency.