5 things ChatGPT (and GPT-4) can't solve in financial services...yet ...
The hype around ChatGPT and GPT-4 and their potential in customer service, research, and writing is not unfounded. Machine learning and AI are playing vital roles in many sectors, including eCommerce, customer service, and road safety.
However, in financial services, there are several things that neither ChatGPT nor GPT-4 can solve presently. This is primarily due to the high-risk nature of financial products and services. Financial institutions (FIs) are responsible not only for ensuring the safety of their customers' assets but also for meeting legal obligations around know-your-customer (KYC) and anti-money laundering (AML) requirements.
Here are five things ChatGPT (and GPT-4) can't solve in financial services:
1. Compliance
Compliance is a crucial part of every financial services business. Companies that handle money for their customers and clients need to ensure that they follow all compliance regulations. Though AI can assist in monitoring suspicious activity, companies also require experts to assess evolving rules, determine strategies and oversee the compliance program to ensure that they meet those requirements.
2. Credit Underwriting
While data analysis is vital in credit underwriting, determining the right policies to use to decide the data that goes into those decisions requires human insight. FIs need to evaluate their risk priorities to determine suitable credit thresholds for their business. They can then use credit bureau data to determine if a customer meets their credit policies.
3. Account Opening
Customers expect a frictionless experience when opening an account that can be completed in 10 minutes or less. Financial institutions have relied on phone-based identity verification and document verification to verify a customer's identity based on the information they have entered during the onboarding process. But when addressing post-account opening issues, customers expect a more immersive experience and to interact with a bank representative directly in case of problems.
4. Developing New Financial Products
Developing new financial products requires a deep understanding of market trends, customer needs, and regulatory frameworks. It requires making strategic decisions that go beyond what data alone can tell us. While ChatGPT/GPT-4 can provide insights and suggestions based on data analysis, it cannot replace the creativity and intuition of a human designer.
5. Fraud Prevention
Fraud models are helpful tools, but financial companies need AI/ML teams to ensure their policies remain up-to-date, and they are continually testing and updating their workflows to handle attacks when they arise. ChatGPT, GPT-4, and future updates might be powerful tools that can help financial services companies in many ways. However, these products aren't able to replace some of the higher-touch, more nuanced parts of running a financial services business.
Companies that can strike the right balance between automation and human touch will be best positioned to succeed over the long term by delivering value to their customers consistently and quickly.
