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AI and the future of financial services | Making Digital Easy | Part 6 of 7

In this series, we will show you how to use digital technology within your business to transform your everyday processes, enhancing client loyalty, increasing profitability and delivering compliance confidence.

The seven-part series will cover the following topics -

  1. Meeting your clients’ expectations.
  2. Using digital to transform your everyday business processes.
  3. Going from Good to Great
  4. Using your app with your next generation of clients
  5. What’s my back office for?
  6. AI and the future of financial services
  7. Keep it simple and on-brand

Like this article? There's more where that came from. This is part of a 7-part series on Making Digital Easy. To view the full guide, click below.

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Times are indeed changing, and they’ve never been changing faster. Technology is enhancing every aspect of our daily lives, helping us cope with pandemics, tracking and tracing our every step, and more and more companies are using our data to sell us more products to quench our insatiable appetite to consume. Set against this, advisers can feel like a calming almost unchangeable force, offering sound advice when all around people seem to be losing their heads in a giddying race to create money from nothing, invest in the next unicorn or double your money with crypto currency fever.

“AI doesn’t have to be evil to destroy humanity - if AI has a goal and humanity just happens in the way, it will destroy humanity as a matter of course without even thinking about it, no hard feelings.”

- Elon Musk

Artificial Intelligence is going to have a major impact on our lives. For some the potential is horribly scary with thoughts of the apocalyptic rise of the machines. Some of us simply can’t fathom what we’ll do with all our spare time, particularly if we are no longer needed as part of the workforce in future.

Many of the jobs that humans do could be augmented with AI and we are increasingly seeing effective use cases across many different industries from healthcare and medicine to education, HR or recruitment. In all of these professions, AI is supporting and complementing human interaction to make us more efficient, whether that’s improving diagnostics in medicine, enhancing learning in education or screening candidates in recruitment. AI can reduce the busy work and enhance our productivity so that we can focus on the conversations, the human interactions, and relationships that we all really value.

AI will bring the next phase of productivity and allow advisers to see more clients whilst delivering a better service.

It’s our job as your technology supplier to keep you advised of and ensure you can take advantage of these new technologies as they are developed.

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What about AI in financial services?

AI in financial services has some notable success stories, underwriting is perhaps the most touted and the reason is that the outcome – insure or don’t insure is a decision that’s immediate. The rules of the game can be taught to an actuary and these same rules can be taught to a computer. The data about previous decisions is available in great quantity for most large firms so it’s possible to train AI over time to make better and more complex decisions as the machine learns.

The use of AI across financial advice is accelerating. As with any technology that has the potential to save time, reduce cost and make us more efficient, firms that adopt AI will gain a significant competitive advantage over those firms that continue with the old ways of working. AI is set to make a transformational difference, from drafting documentation such as reports or suitability letters, to support chatbots and assisting with compliance checking and monitoring.

Through generative AI we are seeing the growth of personalised content, customised to individuals’ preferences, and learning from their behaviours. This is enabling firms to engage more regularly with their clients, and importantly provides an effective way to connect with the next generation of their clients.

AI assistants like Microsoft Copilot can transcribe and summarise meetings, pulling out actions and providing insights. This is a simple but highly effective use of AI that saves significant time and carries minimal risk, as any outputs from the AI are checked by a human before they are sent to the client.

New fintechs are entering the market, training large language models in the nuances of financial advice so that generative AI can analyse fact find data and meeting interactions to produce recommendations and suitability reports. These tools can be integrated into onboarding or client review workflows to automate the delivery of these outputs to adviser and client.

With support from the regulator for technology innovation and the promotion of “safe and responsible use of AI in UK financial markets ”, the opportunity for AI to benefit financial advice businesses and improve outcomes for clients is huge. Used ethically and with the right risk management and governance in place, AI has the potential to assist firms in meeting and evidencing their Consumer Duty outcomes. It’s ability to quickly analyse vast amounts of data could be instrumental in future product design. Natural language processing and generative AI is well placed to assist in consumer understanding of complex documents as well as the ability to provide 24/7 support for clients.

AI will drive the next wave of digital transformation for advice firms. It brings an opportunity to further increase efficiency, save time and cost, and make businesses more profitable.

Where to start?

If you are considering the use of AI within your business, it’s important to ensure you approach this as you should any technology adoption. Know your vision and business strategy, the problems you want to solve and the outcomes you want to achieve and spend some time exploring what’s out there and learning how it will meet your objectives.

Microsoft have produced an excellent whitepaper on how to approach this from exploration and planning, to execution and realising value. It’s well worth a read to ensure your AI projects deliver on the benefits you want to achieve and that you implement the right processes and controls for its safe usage.

“Harnessing AI for the benefit of humans and businesses alike has rightly become a priority of Governments, policy makers and regulators everywhere. The UK has a head start provided by world-class universities, brilliant cities and businesses attracting global talent, with internationally respected institutions. The birthplace of Turing and Lovelace has reason to be confident in its leadership as the world grapples with the benefits and risks of this technology.”

- Jessica Rusu, Chief Data, Information and Intelligence Officer, FCA

This quote was taken from the AI update from the FCA. To read the full report, click here .

“Rather than starting by asking what AI can do, we need to turn the telescope around and ask, ‘What are you trying to do in your business, and how can AI help?’”

- Jason Price, Director of Specialist Management at Microsoft

This quote was taken from Microsoft Five Pillars of AI Success. To read the full report, click here .