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Chatbots in the field of banking

1 September 2020
Chezky Shneller
chat box on smartphone

The Coronavirus crisis which is still raging on has coerced business organizations to shift from the physical realm to the virtual. One known way to implement virtual UX is the use of Chatbots. Chatbots are a form of software designed to converse with customers digitally and automatically.

Customers have grown used to receiving an optimal user experience from large corporations such as Amazon, Netflix and Ali Express. They now expect the same level of UX from financial institutions. In a virtual age, customers demand both self-serve capabilities and to receive quick, efficient service when they make contact through various channels. They sure do not wish to call a service center to discuss a transfer. Many customers do not wish to physically arrive anywhere to open a new account or perform any financial transaction.


Utilizing chatbots in banking environments has its advantages:

  1. Chatbots automate frequent and simply answerable questions and answers. These include transfers and accounts, hours of operation and resetting passwords. By taking over these tasks, chatbots allow service centers to deal with issues of greater value. A live chat with a banker would be needed in more complex situations, such as opening accounts, credit card fraud and data regarding loans. Chatbots play a pivotal role in these cases, too: they are those that direct the call to the relevant functionary.

  2. The chatbot is available 24 hours a day.

  3. It possesses an innate ability to measure and monitor.

Furthermore, Chatbots are innovative. They are the most efficient way for an organization to make its services accessible to its users. This solution is intuitive, as chatbots are placed in a setting natural to users. Its development involves a fairly quick process which requires relatively few resources since they can be generated in a codeless fashion. And finally, it has been proven to improve UX: over 75% of users have reported a natural, pleasant experience.


Despite this tool's advantages, implementing and applying it hoping to benefit efficient, substantial support to financial institutions isn't considered a quick or economical solution. Technology alone cannot solve challenges involving deciphering and managing information that is directly connected to the process. For example, the way data flow in chats is managed precisely and comprehensively). The data the chatbot holds is what fuels the conversation and the user experience. Optimal data flow is attained by using multi-staged conversation scripts which necessitate complex decision diagrams. For example, a seemingly simple chatbot convo such as 'opening an account' or 'reset password' may contain more than 25 decision diagrams. The compilation process is complex and when prepared for a banking chatbot it is vital to incorporate banking experts (besides KM and technological personnel) to ensure optimal UX.


Another challenge setting up a chatbot for banking settings stems from the regulation so prevalent in this area. The chatbot must meet the monitoring and procedures challenges this field involves. Therefore, the chatbot must include functions familiar to us from the field of Knowledge Management:

  1. Comprehensive version management documenting changes to content items, as well as by whom were these changes authorized and when

  2. Workflow for content authorization to ensure that every new or updated content goes through the appropriate authorization process

  3. Connectors allowing consumers a smooth journey from one application to another

  4. Banking Security complete with full monitoring of record management


Furthermore, it should be noted that chatbots aren't a 'fire-and-forget' tool. They require consistent analysis, fine tuning, and optimization to ensure their constant improvement. They must adapt to customers and provide a positive UX and therefore require resources to function efficiently.


It is safe to say that designing a chatbot for banking settings is a process replete with challenges. Lest us forget that it is merely a complementary tool among a larger set of tools available to banking consumers. These tools include banking applications which allow them to follow deals and online banking that allow them to perform simple transactions. The chatbots advantage is that it can provide technical support and basic services via digital channels such as the internet, the mobile app and online banking. The chatbot can provide answers regarding products and technical malfunctions. It also enables an intuitive search, directing consumers to their next stage.


Despite the aforementioned challenges, chatbots' advantage should be considered and implemented.


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