3 applications of machine learning in financial services
Machine learning is a subset of artificial intelligence that allows computers to “learn” from data without explicit programming from humans. In financial services, it can transform business processes related to customer service, personal finance, and fraud and risk management. Here are some real-life applications of machine learning in each of these areas.
- Customer Service
Chatbots are being deployed in financial services to automate common customer service requests, answer frequently asked questions, and assist with transactions like making bill payments. They use natural language processing to understand what a person is saying and formulate an appropriate response in return. However, chatbots sometimes struggle with interactions that go off-script from specific instructions they’ve been programmed to follow.
Machine learning helps customer service chatbots assimilate information from each interaction and “teach” them how to respond in the future. For example, machine learning can teach chatbots how to identify frustration and adapt subsequent responses. This might mean replying with calming language designed to diffuse the situation or perhaps redirecting the frustrated customer to a live agent.
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