Future Implications of AI in RCFIs and Digital Banking Discourse at the Council
Deep Varma, serving as the CTO at Alkami, highlights the strategic advantage regional and community financial institutions (RCFIs) have in implementing artificial intelligence (AI) and machine learning (ML). Despite larger entities making headway in AI, RCFIs are moving forward with experimentation in various use cases, differentiating themselves from competitors.
Since the late 2000s, financial institutions have utilized AI and ML for tasks such as data analysis and fraud detection. The growing investment in AI, expected to rise from $35 billion in 2023 to a staggering $97 billion by 2027, reflects a 29% compound annual growth rate.
Generative AI (GenAI) is revolutionizing these applications with real-time insights, minimizing disruptions and informing customers of potential issues. Chatbots and virtual assistants employ GenAI to enrich user experiences while documentation tools handle repetitive tasks.
AI-driven data modeling helps in areas like credit scoring and loan processing, further enhanced by personalized product recommendations and insights from GenAI. This digital transformation not only creates new revenue streams for RCFIs but also delivers improved account holder experiences.
In fact, 88% of RCFIs report successful AI technology testing, and an overwhelming 78% believe AI can fuel new business opportunities. AI technology will fuel account holder interaction improvements, with 73% of financial institutions supporting the role of AI in enhancing personalized financial advice.
As AI technologies advance, RCFIs should leverage agentic AI, which includes reasoning and iterative problem-solving capabilities. Pinpointing consumer preferences and market trends, agentic AI tools can uphold personalization, boost cybersecurity, and maximize operational efficiency within HR and software development.
Integrating enterprise technology and conversational AI agents can aid RCFIs in mitigating compliance concerns, while also streamlining internal operations. By evaluating and optimizing existing data management foundations, new AI processes can yield a competitive advantage in the evolving financial landscape.
Alkami's Website Technology Council welcomes qualified CIOs, CTOs, and technology leaders.
Sources:
- Deloitte AI in Banking Survey (2020)
- AI in Financial Services 2022 Report by IBM
- AI in Financial Services: Technological, Regulatory, and Social Challenges
Deep Varma, Alkami's CTO, emphasizes the importance of RCFIs leveraging AI for competitive advantage in banking. Varma believes that RCFIs, despite larger entities' progress, can differentiate themselves through AI experimentation in tasks like credit scoring and loan processing. Deep Varma's foothold in the industry, combined with his expertise in AI, can help RCFIs capitalize on emerging AI trends in documentation, chatbots, and virtual assistants.