2024: The year Generative AI reshaped customer experiences in banking

A strategic roadmap for 2025 on the use of Gen AI

As we approach 2025, it’s visible that 2024 was a transformative year for banking, with #GenAI taking centre stage. What started as a tool for content generation, evolved into a core enabler of customer-centric banking. From conversational AI to hyper-personalised financial solutions, the industry has redefined customer engagement.

Here’s my perspective as a banker and strategist on what unfolded and how leaders should prepare for the future.

Let’s first look at the use cases of GenAI that were delivered in 2024:

1. Hyper-Personalisation

The most common use of Gen AI was in the tailored recommendations for savings, investments and loans. Banks have used their vast data over years to generate credit scores and probabily of defaults and other credit ratios. But GenAI provided an additional tool by analysing customer data in real time so that banks could provide financial advice that were proactive and personalised. We will see more fine tuning of hyper personalisation in 2025. Customers receive instant, AI-generated forecasts about how market shifts might impact their portfolios- an example of scenario-based advice. Or, loan terms being adjusted dynamically based on customers’ profiles and behaviour patterns. These dynamic and real time customised solutions have been a difefrebtiating factor in the product offerings.

2. Conversational AI redefined customer support Chatbots and virtual assistants moved from simple Q&A functionality to complex problem-solving. You could notice a differentce in customers experiences using conversational AI. One of my favourite examples of this is the debacle of Air Canada’s chatbot giving out incorrect information to one of its customers in 2023. Do you remember that news? From that incident to better human-like empathetic context-aware conversations, GenAI improved remarkably in 2024.

We have also seen the integration of AI assitants from opening to fraud reporting- end to end workflows were seamlessly handled.

3. Enhanced fraud detection and risk management We saw a wide use of GenAI for analysing patterns across billions of transactions to flag anomalies. The results translated into real time alerts to customers on suspicious activities and proactive preventions like on high-risk accounts.

4. Content generation for marketing and customer education GenAI empowered the marketing teams at banks to craft highly engaging and personalised campaigns, anywhere from financial literacy to explaining common scams and frauds.

What were the lessons learned in 2024 for GenAI in Banking?

2024 taught us that GenAI might have a lot of utility for the banking industry but it also comes with high risks, such as

1. Data integrity is non-negotiable GenAI’s effectiveness depends on high-quality, diverse data. Banks must ensure that they have a robust data governance. That will lead to better customer satisfaction and reduced compliance risks.
2. Balancing automation and human touch While GenAI excel at efficiency, customers still value the option of human interaction for high-stakes decisions. Successful banks will be those who recognise this and create hybrid models.
3. Regulation was a game changer Governments worldwide began enforcing stricter AI regulations, requiring transparency and fairness in AI-driven decision-making. This has rightly forced the financial institutions to audit their algorithms regularly.

The road ahead for 2025

From our learnings in 2024, I believe the banks and the financial institutions should follow the below for 2025 :

1. Invest in ethical AI practices: Build trust by ensuring your AI models are transparent, bias-free and explainable. Customers and regulators will demand greater accountability.
2. Create AI augmented workforces: Train employees to work alongside AI tools so that it enhances productivity and decision-making. We have seen the impact of this in a Corporate Banking vertical of a bank that we worked with. Upskill teams in areas like AI oversight, data analysis and enhancing customer experiences/journeys.
3. Prioritise customer-centric AI design Focus on solving real problems for your customers, rather than adopting AI for AI’s sake. For any feature that you add, ask-

• is this tool intuitive for the customer?
• does it make their banking experience simpler and more rewarding?

2024 showed us that GenAI isn’t just a technology, it’s a strategic differentiator. As we enter 2025, the banks that succeed will be those that seamlessly integrate AI into their operations, prioritise ethical practices and focus on delivering value to their customers. We also anticipate regulatory shifts as AI is gaining momentum. One can be proactive and stay ahead by integrating compliance in their blue print.

The future of banking is being written by those who embrace innovation today. Those who are proactive and embrace change will emerge as the winners.

@www.anthropia.in

#piyudutta #banking #genAI #customerexperience