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Banks Using AI for Wealth Management
AI powered services, products and technologies are being introduced in the Financial sector’s Money Management segment.
These technologies’ influence on Money Management is growing beyond the Chatbot and fraud detection.
The adaptation includes Wealth Management groups like Trading desks, Investment and Governance departments that are trying to understand the impact of these technologies.
But, where it is headed can only be appreciated by looking at what major banks are doing now with AI technology.
Banks have been using AI for credit and account activities, however the push in AI Banking is going beyond these basic products.
Financial Planning and Wealth Management are two of the services banks are empowering with AI.
Some of the main goals banks are trying to achieve for their Wealth Management segment thru AI include;
- Serve customers using very personalized approaches, driven by data and AI
- Develop talents for the future, who can combine AI with customer service skills
- Transform middle and back offices using AI technologies to reduce cost and improve services
- Use AI to predict success of potential investment choices
- Develop more intuitive systems to serve customers
- Allow clients to design their own investment models
So far, Financial Advisors are still interfacing with clients even in banks updating their system with AI.
While some customers don’t have any desire to replace their Financial Planners with the machine, others don’t mind and even prefer the choice of AI driven recommendations.
Some banks are empowering their Financial Advisors with AI, others are pushing the tools directly to the consumers who will have it on their mobile phone. Still other banks are only using chatbots and fraud monitoring tools at this stage.
For consumers who are looking for AI to assist in money management decisions, banks are getting ready. Below are a few institutions with functioning or in the making AI powered financial advice.
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Banks Using AI Wealth Management Tools
What is driving the adoption of AI in the Financial Advisory industry?
Clients needs have grown more sophisticated due to changing Economics, availability of more complex financial products and emergence of new technologies.
For consumers looking for AI assistance to make investment decisions, here are some of the banks making inroads with this technology.
JP Morgan Chase AI
JP Morgan is pioneering an AI investment tool similar to ChatGPT to be used directly by its clients in modeling their portfolios.
This bank is planning to use AI to assist customers in the selection of securities.
IndexGPT is the tool this banking institution is planning to use to select investment securities for clients.
JP Morgan is planning to detach the Advisors from the AI process. IndexGPT will be given directly to customers to make investment decisions based on its recommendations.
The bank is leading the implementation of AI in Wealth Management and it is increasing its AI staff for Quants, Compliance and Governance.
Morgan Stanley – GPT
Unlike JP Morgan Chase, Morgan Stanley will upgrade its Financial Advisors workforce with GPT-4.
This Investment firm is using GPT-4 to create human advice with the assistance of AI technology for its large Advisors workforce.
Morgan Stanley is building AI tools with GPT-4 to organize its proprietary data. This will provide insights the Financial Advisors can use to assist clients with their investment decisions using AI.
This investment bank is using AI to generate investment recommendations for clients. Private Banking monitors investment portfolios’ overweights in specific assets using AI models.
Assets that are complement to customers like shares of stocks, bonds and funds are matched by AI programs.
BNP Paribas is using AI to answer customers inquiries via chatbot and to detect potential misconduct in the Capital Market area.
Wells Fargo, like BNP Paribas, is using AI mainly to provide customer service using chatbots and in the Compliance area to determine data to be reported to regulators.
This bank is also using AI to improve back office processes and automating repetitive tasks.
For customers looking to see if their bank is using AI for advice or planning on using this technology, these banks are already laying the grounds.
Using large data analysis, AI technologies are changing the type of advice and other strategies in Wealth Management. Advisors will make use of AI and may have new and different roles.
Opportunities for banks lie in providing very personalized services and discovering probabilities of success with more assurance. This is all possible with Artificial Intelligence technologies that can organize and make sense of very large data.