AI Revolution in Banking: A Case Study of Wells Fargo
Artificial intelligence (AI) is transforming the financial sector, providing fresh tools for improving customer satisfaction and streamlining processes. A prime example is Wells Fargo, which has leveraged AI to enhance its estate management services, significantly boosting customer recommendations. According to a report from Computer Weekly on August 21, Wells Fargo's Estate Care Center (ECC) has dramatically improved its net promoter score, a key indicator of customer satisfaction, moving from negative to over 60.
What is Estate Management? To put it simply, estate management involves handling the financial affairs of a deceased person. This can include distributing assets according to their will, paying debts, and closing accounts. Traditionally, this process can be lengthy and stressful for the bereaved family.
Wells Fargo's AI-driven approach has streamlined these complex procedures. Previously, family members had to contact every department separately to report a death. Now, integrated IT systems handle this seamlessly, improving the customer experience. This approach has not only enhanced satisfaction but also increased asset retention and attracted new accounts, as some family members choose to transfer their accounts to Wells Fargo after experiencing the improved service.
The bank's collaboration with Pegasystems, a leader in business process management, has been crucial. This partnership allowed Wells Fargo to integrate various departmental systems, creating a smoother and more efficient estate management process. Currently, the ECC employs around 800 people globally, handling approximately 500,000 deaths and managing $32 billion in transfers annually.
AI in Compliance: Treasury Prime and Kobalt Labs
In another example of AI's impact on banking, Treasury Prime, a San Francisco-based embedded banking software provider, has teamed up with Kobalt Labs to tackle the compliance challenges banks face in embedded finance. This partnership is part of Treasury Prime's Partner Marketplace, providing banks with AI-powered tools for managing third-party risk and compliance.
What is Compliance in Banking? Compliance refers to the procedures and processes banks must follow to adhere to legal and regulatory standards. This can include ensuring customer data privacy, maintaining financial records, and reporting suspicious activities.
Kobalt Labs’ platform synchronizes with current financial regulations and security standards, offering rapid checks on vendor documentation against regulatory requirements. This technology is claimed to boost internal diligence capacity by over 400%, a significant advantage in a sector grappling with increasing regulatory pressures.
Kyle Costello, head of partnerships at Treasury Prime, emphasized the importance of managing compliance costs for banks considering embedded banking investments. By partnering with Kobalt Labs, Treasury Prime enables banks to scale their Banking-as-a-Service (BaaS) programs more efficiently.
These advancements signify a broader trend in the financial industry towards using AI to enhance compliance and risk management, suggesting a future where banks operate more efficiently in an increasingly digital landscape.
