With the recent and unprecedented time frame and COVID-19 Pandemic, its obvious that global trend has shown a migration for an environment or an ecosystem wherein it has become more evident that Machines will be churned out in larger numbers for carrying out a majority share of work.
It will exactly be how this automated future—and as a momentous significance, the future of humanity—will ultimately turn out remains to be viewed at this stage. But as clients, one benefit we are hopeful to benefit from such a future is the prospect to have more time to do the possessions we love and to spend less time doing those routine tasks that will most likely end up in the hands of robots.
In fact, it is clearer that majority of those tasks, it would seem, will get under the classification of individual finance. And as well as thanks to the evolution being made in autonomous finance, such responsibilities will also become the obligation of machines and algorithms.
By optimally utilizing these technological advances, particularly artificial intelligence (AI) and automation, autonomous finance pursues to improve a significant burden from clients’ shoulders by powering numerous core financial decisions and procedures. It incorporates a range of algorithm-based services that can take financial decisions or actions on behalf of clients.
Of course, the above definition would principally power us to conclude that autonomous finance is far from being a new creation. Indeed, certain solutions have already made considerable inroads into the mass realization, with the likes of robo-advisory now offering an algorithm-powered investing decision on behalf of investors.
Whilst they have not taken over the entire investment industry, robo-advisors have nevertheless engraved out a distinct niche in the market, helping a wider range of clients that have long been looking for low-cost, low-hassle investing solutions.
And being among the first produce of effective autonomous-finance applications, robo-advisory serves not only as an ideal predictor of what’s to come but also as an indicator of the existing healthy appetite for algorithm-driven solutions that can save clients precious time, currency and energy, which can be redirected towards other significant aspects of their lives.
Indeed, as we move onward, autonomous finance looks set to enable an all-inclusive overhaul of the financial-services industry by integrating technologies into virtually every major client-oriented merchandise and service. And as those technologies themselves endure to evolve, along with widening access to online client data, they will unlock even more sources of worth for clients.
At this stage, we conduct much of our financial affairs via the specialist services, such as banking with a high-street money lender, investing with a brokerage firm service, transferring the payments utilizing an online transfer service and saving via a personal-finance app. Such platforms, however, involve their clients taking manual decisions based on their own preferences. The true innovation behind autonomous finance, however, is that even those decisions will be mechanized without leading to any loss of value.
According to Rachid Molinary, senior vice president of digital strategy and innovation at Spain’s Banco Popular “Autonomous finance is the organic merging of all the technology innovation we’ve been seeing over the years, from AI to unique access to data, to finally delivering on self-driving finance,”. There is also likely to be further integration among such services so that there will be no need for them to be conducted through separate platforms.
However, the demand of autonomous finance goes well beyond simply enlightening efficiency and budgets for businesses and clients alike. Much of it also lies in its ability to progress beyond what is currently available, and that means an overall better client experience with optimal final consequences.
According to a Salesforce survey of nearly 2,800 global leaders from the financial-services sector, the most noteworthy commercial assistances that are likely to emerge from autonomous financial decision-making are boosted client experience, improved customer retention and better customer thoughtful; while on the clients’ side, they will take an advantage from enhanced financial wellbeing, better personalization, simplified decision-creation, better proactive client service and upgraded access to financial advice.
It was also observed that the top use cases of autonomous finance vary considerably by sector—for retail-banking leaders, mechanizing account transfers is at the top of the priority list, with client behaviours possibly triggering the frequencies and amounts of transfers depending on such factors as balances and goals.
For insurance leaders, however, claims dispensation represents the top use case for autonomous finance, with a theoretically significant discount in human error from the current manual, resource concentrated process being a particular advantage. And on the wealth-management front, leaders forestall the optimization of investments via the automated savings, portfolio rebalancing, dividend reinvestment or tax-harvesting strategies as being the most desirable application of autonomous finance. With such gaps emerging between prospects and reality during the pandemic, there is a mounting belief that turning to an autonomous solution can help clients not only during this time of crisis but on a more permanent basis. “There is improved urgency to instrument autonomous finance competences such as artificial intelligence (AI)-based chatbots, automated online processes to handle higher volumes, and personalized data and offers,” noted Chris Skinner, best-selling author and chair of the European networking forum The Financial Services Club, in November.
“Especially in a time of crisis, FSIs need to be able to offer support through the channels its customers prefer. And using autonomous finance tools like AI-enabled chatbots can help fill this gap.”