The conversation around AI chatbots and their potential to disrupt the way we work has become unavoidable. Utilizing natural language processing and generative techniques to provide responses to a wide range of prompts, the applications are limitless — from long-form content to lines of code to full-blown conversations, users are experiencing new levels of personalization driven by technology.

With their boundless potential and rapid growth, these tools have captured the attention of seemingly every industry, including banking. AI-driven technologies have already secured a sizable foothold in the sector, and demand is growing. According to a 2022 survey conducted by Morning Consult in partnership with IBM, 35% of companies globally are now using AI, up four points from the year before. By integrating AI technology throughout the customer journey, banks and financial institutions have the opportunity to create a truly customized, data-driven experience while opening up new revenue streams for their business through core product offerings and added-value services like protection.

For banks and FIs, surfacing the appropriate products to their customers at the right time is crucial to sustaining ongoing engagement and extending the lifetime of that relationship. FIs should integrate with platforms that leverage AI to learn what the customer’s needs are and instantly serve up offers that align with them, continually refining their recommendations as they learn more about their purchase behavior. You could even imagine a scenario not too far in the future where this information is collected and returned via chatbot, so that businesses can further automate the process while still retaining that human touch.

With the right partner or technology, FIs can recommend lending services like better mortgage rates or auto loans, boosting core conversions for the business, or added-value services such as wealth management, financial wellness and even tailored protection that matches their transactions and purchase history. These protection offers can be presented at the point of sign-up or other critical touch points down the line, steadily growing that relationship with the customer while generating consistent revenue for the business.

AI-powered platforms have the capacity to ingest and hold massive repositories of data, and through this, can pair relevant protection offerings with the relevant life event. If a banking customer applies for a car loan, for instance, the AI can offer them car insurance to keep their investment safe. And the consumer demand for this kind of innovation is considerable, with 70% of customers worldwide noting a high interest in ​​bank-embedded insurance offers based on transaction data.

Chatbots could be the next iteration of creating truly bespoke customer experiences. Taking protection as an example — the rise of embedded technologies have enabled customers to add protection offers at the point of a major life event or transaction rather than having to search for coverage on their own or go through a broker. Companies that are incorporating AI and machine learning into their platforms have been able to marry the convenience of an embedded approach with tailored offers presented in real-time. By routing this process through a chatbot, customers can enjoy a more personalized service than ever before. Through the accumulation of data, the AI knows the right questions to ask, and rather than choosing from a set of canned responses, can converse dynamically with the customer to make hyper-relevant and precise recommendations.

AI-powered technologies can ensure protection is not only more personalized through constant learning and fine-tuning, but also more secure and anonymized. This opens up a world of opportunities for optimization and speedier processes without the risk of human error associated with the traditional process of feeding information through an engine and having people determine the right product for the customer. It also enables companies to scale their business as the AI collects more and more data and trains itself over time, so they can dedicate time and energy to more strategic initiatives.

Chatbots may not be able to write the next Great American Novel, but they can certainly revolutionize the way that companies interact with their customers and enhance the experiences and services they offer. And that’s the real draw — AI technologies are a way to elevate the things that FIs are already doing, like recommending products or assisting customers, just in the way the customer wants. As customers trend toward more self-service options, they don’t want to lose those elements of personalization and engagement that keep them loyal to your brand for life.