An interview with Fahd Rachidy, Founder and CEO of ABAKA.
Engaging customers in financial planning for the future: what challenges does the sector face?
The UK population is ageing – by 2066, over 65s will make up over a quarter of the population. But many could be sleepwalking into retirement without the pension savings or financial plans in place to enjoy their later years. That’s why it’s more important than ever before for financial services providers to engage customers on planning for the future.
Financial services (FS) providers face various challenges when it comes to engaging customers on issues relating to their retirement. The constraints of legacy technologies and paper-based processes make it harder for the industry to get customers excited about planning for later life.
What fintech tools have emerged recently that can help the sector meet those challenges?
Artificial Financial Intelligence has the potential to have a transformative impact on the retirement market – particularly in the form of both conversational chatbots and intelligent nudges.
AI-powered conversational chatbots can help financial services companies to communicate with customers in more dynamic, self-service environments rather than sending customers 20-page statements that nobody reads. They enable financial organisations to offer hybrid advice solutions, where chatbots source preliminary information needed for validation and can categorise customers relative to their needs. In a world of hyper-personalisation, intelligent nudges are a powerful way to engage with customers when and if they need it.
All of this means that advisers can spend more time actually offering advice and building trust with their customers. Similarly, providers will be able to draw on more unstructured or behavioural data acquired by the bot, augmenting the interaction with a relevant pool of rich data and insight about the customer.
Can chatbots be truly ‘intelligent’?
Chatbots powered by natural language understanding – such as Abaka’s chatbot Ava – are adding real value to customers. Alongside delivering human-like conversations and comprehensive product information, natural language processing allows chatbots to build an extensive range of appropriate, relevant responses. They can answer an expanding variety of questions in an engaging, genuinely conversational way. To add to this, interactions can be fully audited. This means that the solution can work in conjunction with third party services, further personalising and integrating the services being provided. Used well, chatbots save time, money and improve the customer experience.
What immediate impacts could AI-powered conversational platforms have for FS organisations?
Providers have a responsibility and a commercial imperative to educate and guide our ageing population towards suitable retirement options. Intelligent chatbots can play their part by enabling providers to begin new conversations with a wider pool of customers.
Abaka has found that these services significantly improve customer engagement, opening up channels of communication and providing ease of access to information. Older customers are used to the technology – Facebook Messenger and Amazon’s Alexa, for example, are popular with older people.
Some older customers like being able to ask a machine questions without having to worry about whether they look silly or feel they should know the answer. Bots also empower customers to ask a question several times without fear of embarrassment.
Artificial Financial Intelligence is relatively simple to adopt, quick to scale and the ROI will be apparent in a reasonable timeframe. Chatbots and intelligent nudges are part of all of our retirement futures – we need to ensure that we use this technology in the best and most appropriate way to drive better outcomes for customers.