For the average American, there simply isn't enough time in the day to take care of personal finances. Banks offering AI-assisted advisors can help streamline a person's life. Graphic created with freepik.
Help when you need it: 5 reasons why customers expect an independent financial advisor
Two and a half years of a pandemic, followed by the war in Ukraine, have left the world’s economy unstable. Many countries are on the verge of a recession and suffering high inflation rates. In these scenarios, people particularly start to seek advice to make the best financial decisions to protect their capital.
According to Harris Poll, 59% of Americans say there are financial topics they want advice on but aren’t sure how to get it. The top barrier that prevents them from seeking support from a financial advisor is the belief that they don’t have enough money to hire one. This belief can often be compounded as finding an advisor willing to work for a company with a smaller budget can be equally hard.
Banks and other financial institutions must address this need effectively if they want to be on top of the game—and the answer is already out there. The adoption of artificial intelligence (AI) is growing across all markets: 56% of brands report AI adoption in at least one function, and contact center automation, predictive service, and debt analysis are some of the top uses. Independent financial advisors should be an option for everyone. Let’s find out why.
1. Customers don’t have the time or knowledge to deal with their finances
Not everybody is willing to learn more about finances or has the time for it—instead, they turn to their parents. However, 46% of parents with children under the age of 21 would give their financial literacy a grade of C or lower in the United States.
2. They need expert advice they can trust
Money is a highly sensitive topic that people often avoid talking about. Independent advisors are not bound to any family of funds, investment products, or services. Clients can trust that the products and services recommended by their advisors are in their best interests and come from deep expertise and knowledge.
3. They want personalized advice
Everybody’s situation is different, especially when it comes to personal finances. Customers expect advice tailored to them from a wide range of possibilities. Personalization is the key nowadays: 78% of respondents would continue using their bank if they received personalized support.
4. They need financial advice for a special moment in their lives
People are more likely to seek financial advice in certain moments, like when they are nearing retirement, inheriting money, getting married or divorced, or having a child. These life-changing events usually go along with a change in people’s financial situation, and they need help to manage it in the best way possible.
5. They are overwhelmed by the possibilities
Saving accounts, certificates of deposit, bonds, funds, stocks, real estate, crypto…we could go on. The investment options nowadays are endless and complex. People who are not savvy in the subject can easily get overwhelmed and prefer to delegate their finances to an expert.
Enter the conversational AI advisor
AI-powered chatbots and solutions can provide 24/7 personalized financial advice based on the customer’s transaction history, purchase behavior, economic status, income, family situation, age, and other factors. When linked to the Empathy Engine®, the responses become more human and customized. By building unique personas that connect customers’ behaviors, strengths, potential, and needs, banks can understand and improve their financial lives.
Today, the average satisfaction rate of bot-only chats is 87.58%. Customers already accept chatbots for financial advice for its ability to answer routine questions and provide services around the clock. The conversational aspect invites customers to express the issue, leaving the AI to decide whether it can handle the query with an existing blog or set up a call with the next available agent.
Juniper Research expects chatbots to handle 75–90% of healthcare and banking queries by 2022. So, AI and chatbots won’t only benefit consumers. By reducing agent time spent on customer service inquiries via phone and social channels, banks and financial institutions can save 2.5 billion hours by 2023.
Customers are hungry for financial advice, and providing it in an accessible way is the driving force behind the adoption of AI in personal finance. Whether offering 24/7 financial guidance via chatbots powered by natural language processing or personalizing insights for wealth management solutions, AI is necessary for any financial institution looking to be a top player in the industry.