Survey: Banks excited about AI. Customers? Not so much

Banks may be eager to take advantage of opportunities posed by artificial intelligence, but they have work to do in persuading their customers to get onboard, according to research from J.D. Power. 

Less than 30% of consumers trust AI chatbots for financial information and advice, and less than half believe AI will improve their personal finances, according to a J.D. Power report. 

Personalized alerts and recommendations hold some appeal to customers, “but many are wary of allowing AI to control the actions and the application of personal security measures,” J.D. Power said. The firm surveyed about 2,000 U.S. financial services customers on their AI use and opinions in April. 

Roughly 54% of bank customers said they’ve used some form of GenAI, and that’s more likely among big-bank customers than regional ones, J.D. Power said. Banking is predicted to be heavily affected by generative AI, and with the promise of efficiency gains, the industry has scrambled to explore uses to bolster efficiency and productivity.  

Although a hot topic, AI remains somewhat of an enigma, at least to consumers, Ghosh noted. Only about one-third of customers have a solid grasp on how AI works, and many can’t tell when AI is being used, she said. 

“The onus is on financial institutions to communicate to their customers a clear understanding of how AI works and its benefits,” J.D. Power said in the survey findings. 

Bank customers expressed apprehension around data privacy and security, increased risk of fraud and loss of human support when AI is involved. There’s also unease about potential bias and fairness issues related to AI, particularly regarding lending decisions.  

Banks have started to leverage AI in substantial ways, including by offering customers tailored financial advice and quick assistance through chatbots and virtual assistants. As for banks’ own operations, AI is automating tasks such as fraud detection, payment processing and loan approvals.  

As interest in generative AI has increased, banks are pursuing its use to help software engineers develop code or make virtual assistants smarter and more efficient. Publicis Sapient’s recent study polled 1,000 senior banking executives and discovered about one-third of banks’ customer experience investments are going toward AI, machine learning and GenAI. 

Customer perception of AI, however, is a bit of a mixed bag. Most consumers believe banks are using AI to prioritize their own interests over those of customers. 

Of customer-facing ways banks are tapping AI, consumers expressed the most interest in alerts that might offer them a tangible benefit: Close to two-thirds of bank customers are interested in trying AI-powered account alerts that would help them avoid service charges and fees.  

Consumers were less enthusiastic, however, about using automated phone voice assistants to handle customer service issues (44%) or taking personalized product recommendations generated by AI (42%).  

On the customer service front, customers are worried it’ll be harder to reach a human when they need to address complex issues.  

In light of that, it’s not surprising that consumers want their banks to employ a significant level of human oversight when AI is used. 

Customers also want to be informed when AI is involved in their interactions with banks.  

Banks should emphasize AI’s security benefits, whether that’s enhancing fraud detection or real-time transaction monitoring, and offer clear explanations on how AI processes data.  

Banks also need to give customers visibility into how AI decisions are made.