Retail banks are investing heavily in AI, but Forrester analyst Alyson Clarke argues many are pursuing it for the wrong reasons. While banks often measure AI by faster service, more self-service use, and more products sold, consumers—particularly those under the age of 50—are using third-party AI tools for financial guidance and decision-making, despite concerns about errors and hallucinations.
AI's greatest value may therefore be its ability to deliver personalized guidance to people who have not had access to advisors. As consumers get more comfortable asking AI for financial help, banks will need to show that their own tools can offer something better than third-party platforms. Clarke says institutions should focus less on automation and more on using customer data and existing relationships to provide advice at scale.
Check out these Banking with Interest podcasts on how AI is changing depositor behavior, the risks of rogue AI, and why banks can’t afford to wait on the technology.
How do you measure the success of your AI initiatives? Given that younger customers are increasingly relying on third-party AI for financial guidance, what role will your institution’s AI play?