Technologies like artificial intelligence (AI) and machine learning are becoming more accepted, and are having a significant and positive impact on the payments industry. Briony Richter speaks to Prema Varadhan, chief architect at Temenos, about its new AI Centre of Excellence
The concept of AI is not new to the payments industry. That being said, the interconnectedness of technology and humans is new – and becoming stronger every day.
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AI’s full potential is yet to be fully understood. What is clear, however, is that by making AI closer to human thinking, the financial industry can rapidly develop new ways to deliver faster, more tailored services.
Speaking about the potential AI has in the banking sector, Prema Varadhan says: “AI is the essential component in creating the intelligent, personalised bank of the future. Two areas where we see strong application of AI are customer engagement and experience, and data-intensive repetitive back-office processes. The first will provide individualised customer experiences and the latter will help banks reduce costs and gain efficiencies.
“What we believe – and are working towards – is that AI becomes a capability throughout the banking platform. –This is how you can extract maximum benefit beyond point solutions.”
The Temenos AI initiative aims to power banks with the ability to offer personalised services to customers, enhance customers’ decision with data-driven machine intelligence, and maximise straightthrough processing (STP) rates for financial transactions at a reduced cost with limited or no human intervention.
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By GlobalDataThe power of data is at the heart of this development. Data can give banks or other organisations a host of valuable information about a customer. Using it to connect at the right points with the specific products and services allows for a more proactive and reactive relationship. Data is the fuel for AI.
By working with Temenos and its AI centre, banks can focus on getting the best AI tools. Temenos helps banks by providing modern data architectures which are able to collect, structure, record and organise data – both structured and unstructured – from multiple data sources.
The integration tools that Temenos provides offer real-time data governance. Due to the back-end operational structure that Temenos also provides, banks can facilitate high volumes of data to be consumed by AI and machine learning-based applications.
AI capabilities
This initiative will see Temenos inject AI through its digital banking platform. It will get banks ‘AI ready’ by supplying them with top-of-the-line data architectures and realtime applications.
Both machine learning and AI have the potential to revolutionise the way banking operates, by improving operational efficiency and reducing cost. And machine learning is already firmly in the banking and payments environment too, with learning algorithms playing important roles in helping speed along authorisation of transactions.
Asked about the services the AI Centre of Excellence will provide, Varadhan notes: “It will initially focus on working with banks to help them identify and validate the best use cases of AI within their organisation. The aim will be to implement those use cases, which will have the most positive impact on the customer experience and offer greater operational efficiencies.”
Varadhan highlights three main focus points for the Temenos AI Centre of Excellence:
- Front office. Temenos will help banks embed AI to deliver compelling customer
experiences, greater personalisation and smoother on-boarding. This delivers cost savings and new revenue streams to banks. For example, Temenos Front Office Suite has numerous, integration, machine learning models, which mine transactional data to understand customer behaviours and patterns. The results of these models are integrated within the platform in order to provide customers with real-time product, service, or educational offers that enhance their financial lives. - Payments exemption handling. Temenos will use AI technologies to identify any
payments going into exception, monitor users’ manual corrections, and learn how to fix and automate these payments, thereby improving STP rates and lowering costs. - Real-time fraud detection. Temenos is using AI to profile individual behaviours and detect fraud in real time. Banks need self-learning capabilities, beyond rules-based engines, to profile customer behaviour, using vast amounts of customer data and transactions to flag activities outside behavioural patterns that could be a potential fraud. Temenos is working towards using cloud computing to deliver new algorithms that help solve the realtime fraud-detection challenge.
While AI has the power to transform the banking sector, a clear challenge for banks will be maintaining high standards of data quality and governance. Only then will banks be able to provide personalised and seamless customer experiences.
The Temenos vision is to make AI more accessible to banks as they invest more money and time towards it.
