**8. Evidence from the financial system**

With conversational AI being still considered in its infancy, it is even too easy to foresee tremendous progress that can translate into more cost-efficient solutions for many businesses, including financial institutions: focusing on banks, they have been reportedly slow in adjusting to new technologies, since managers have traditionally proven reluctant to abandon tried and tested systems for untested advancements, and by the way investing in technological progress involves huge amounts of money, which would make the risk of failure extra high; however, the transition to "conversational banking" has begun on a global scale, thus persuading banks to increasingly view chatbots and IVAs as new age contact center executives. Actually, these institutions have been pushed to mark digital transformation as a top priority as they have faced competition from fintech start-ups that have engaged in providing faster and more convenient options to their traditional customers in the last few years [16].

Another relevant factor must be identified with the health emergency that has been caused by the global spread of the novel coronavirus since 2019 and that has made an increased need for online services to surface and accelerate right afterwards: according to the United Nations Development Programme (UNDP), "while the pandemic demonstrates the immediate benefits of digital finance, the disruptive potential of digitalization in transforming finance is immense" [17] and positive effects can be even expected as a contribution to sustainable development, especially to the achievement of the Sustainable Development Goals in the 2030 Agenda that was adopted by the United Nations (UN) in 2015 [18]; therefore, not only mobile payment technologies have transformed mobile phones into financial tools for billions and billions of people, but going digital has been positively impacting – and can further upgrade – both supply- and demand-side drivers that interact to ultimately deploy AI to advancing promising areas in the financial industry, such as those involving cryptocurrencies, peer-to-peer lending and crowdfunding, to mention just a few of them. In line with valuable research work by the Organization for Economic Cooperation and Development (OECD), another innovative field to be closely scrutinized is populated by the so-called robo-advisors, that are computer programs designed to generate investment advice according to customer data and that tend to be utilized "as a cheap alternative to human wealth advisors" [19], p. 12.

Not to miss any opportunity, it is worth analyzing the financial system as a whole, beyond the boundaries of the banking sector, which leads to shed unprecedented light upon insurance companies. To support this view, even a quick look at most recent literature can be a source of useful insights to emphasize the potential of the wide range of AI use cases in the market segment that they make up: this almost 300-year old industry has been relatively slow to react to the disruption brought about by the digital age but the rapid pace of technological innovation and changing customer expectations in the last few years have contributed to substantial improvements, with insurtech start-ups playing a key role not only to put forth innovative AI applications in the industry under examination, but also to force traditional insurance players to follow suit; as a matter of fact, AI can be applied to the insurance value chain via a number of entry points, to encompass many areas

(such as product development, marketing and sales, underwriting and risk-rating, claims management, robo-advisory, process improvements and recruitment, besides customer service) [20].

### **9. Success stories**

Accordingly, success stories have unfolded in the insurance industry to learn from, in order to contribute to advances in the financial sphere of the economy, with their valuable repercussions in the real one not to be underestimated. A case study that showcases useful implications deals with Allianz Taiwan Life Insurance Co. Ltd.: it wanted a mobile assistant solution that could work across platforms to better serve customers; using IBM Cloud and IBM Watson Assistant, the company created an AI-powered virtual assistant that is described as being "smart, secure and almost human" and that was forged to field 80 percent of its most frequent customer requests, to provide "real help in real time" [21].

Turning to the banking industry, it is interesting to look at UBank, a digital-only bank established in 2008 and headquartered in Sydney, Australia, that has been able "to shrink time to market" by building a loan app virtual assistant on IBM Cloud platform: after consulting with an IBM Watson and Cloud Adoption Leadership team, this bank launched several initiatives, including RoboChat, a virtual assistant that incorporates advanced technology to support the bank's home loan application form online and particularly to help customers apply for home loans; to see the benefits of IBM Cloud technology at work, UBank and an IBM Garage team selected an initial use case, focusing on the bank's efforts to attract interest in its home loan offerings. Rather than relying solely on an email campaign, this bank built an app that plugs into Facebook and lets customers refer Facebook friends to the home loan program to be promoted and essentially RoboChat has been set up as an additional staff member providing a specific set of skills within this bank's current live chat capability [22].

Another revealing case study involves Banpro, that was founded in 1991 to support the social and economic development of Nicaragua and is part of the banking group Grupo Promerica, with nine operating banks throughout Central America. In an effort to scale exceptional always-on customer service, this bank launched Finn AI's virtual assistant technology in February 2018 and full functionality is being supported in Spanish, the primary language required to serve Banpro's Central American audience: within just one year, this virtual assistant has been able to complete 91% of chats without the need for a human customer service agent and to resolve 80% of customer queries, freeing up human customer service agents' time to deal with more complex customer inquiries; the virtual assistant at issue is not just handling queries from existing customers, as a great impression is being created on new prospects that engage with it and ultimately become new customers, with most common questions from them being about eligibility, product features and the application process [23].

### **10. Unprecedented challenges and opportunities**

Success stories encourage to proceed with investing – money, as well as time and efforts – in technological innovation, not only in the financial industry. Challenges and opportunities ahead include the recourse to sound branding (also known as sonic branding, audio branding and acoustic branding) as a strategic tool for financial services companies to communicate with customers: by tradition, money

#### *AI-Powered Virtual Assistants in the Realms of Banking and Financial Services DOI: http://dx.doi.org/10.5772/intechopen.95813*

has been a visual and physical entity but financial institutions are now getting involved in technological progress that should help them become recognizable audio brand entities as well; the mass adoption of smart speakers with voice assistants that are designed to enable audio-search, command and transactional capabilities has widened the spectrum of channels through which consumers can interact with brands and is pivoting service technology firmly in the direction of audio [24].

A recognizable and reassuring sounding brand that people can hear and easily associate with the services provided by a bank is likely to help build trust and engagement, to be undoubtedly considered relevant in the financial industry more than in any other sector. As a reinforcement, it can be argued that brand engagement is reportedly far stronger when audio is treated as an equal and essential aspect of the brand: therefore, it makes sense that quite a number of financial institutions are already harnessing the power of a well-designed sonic strategy to boost their brand; looking far beyond the solitary sonic logo, these institutions are creating holistic systems of branded sound and music that are flexible and anticipate proof for the technological advances of the future [25].

Among the frontrunners, HSBC launched its "sound identity" in 2019, a year after refreshing its visual brand identity to focus on its hexagons in a bid to make its brand more consistent: a bespoke piece of music was chosen to help people instantly recognize this bank and was proposed as the "next natural phase", with the marketing team cooperating with the digital team to get the audio in the bank's apps [26]; one of the major motivations was to reduce the fragmentation of HSBC's brand and the audio generated a brand score that could be used across multiple experiences, both online and offline, to create a universal brand identity through sound, at a time when consumers are increasingly busy and distracted [27]. By the way, recent developments have even enabled smart speakers to be adopted for voice-activated banking and as we march forward into a post-Covid era, that should be ever more screenless, the role of sound is set to become ever more important for the industry under scrutiny (and beyond).

## **11. Conclusions**

To conclude, technological progress and changing consumer habits bring about unprecedented challenges that even lead to question how banking brands can retain trust while physical currencies tend to disappear and real, human interactions seem to increasingly belong to the past. At the same time, valuable opportunities keep emerging, that are worth taking: although there is less human contact, interactions can be more personable through tailoring the experience around the customer; as shown by the recourse to a brand's "hymn", the sound of this experience can play an important part both functionally and emotionally.

It's no secret that technology keeps evolving. For instance, IVAs hold extensive capabilities to help revolutionize banking: the critical focus is to identify the right areas to deploy these AI applications to, as well as to leverage chatbots; compared to IVAs, they are said to lack "understanding" of human emotions but chatbots that can gauge human sentiments are now being developed with the help of AI emotional intelligence.

All in all, AI can be considered a game changer in the financial arena, as well as in the real sphere of the economy, and also has the potential to contribute to the 2030 Agenda that was set up by the UN to provide a shared blueprint for partnerships for peace and prosperity for people and the planet: accordingly, a broad approach should be assumed to give due credit to the digital transformation that is spreading on a global scale and that preludes to creating inclusive digital economies

#### *Virtual Assistant*

as non-negotiable; factors to be further investigated range from technological advances that keep stimulating progress in the financial industry (especially in the delivery of banking and financial services) to the efforts under way to deploy AI to build the post-pandemic "new normal" as a stepping stone to a "new future". Anyway, a mental shift still stands as a precondition for meeting the challenges that raising the bar of intelligence over time implies and for taking the underlying opportunities.
