Banking as a Service: What will happen to our banks if ChatGPT becomes my bank advisor?

Among the summaries we have drawn from the various presentations at the recent CapIT conference, it seems there is a threefold dissatisfaction among customers regarding their relationship with major banking & insurance groups:

• The advisor is no longer considered a trusted advisor. He is seen by the customer as a generic salesman who tries to sell a maximum of products on which he is commissioned, the interest of the customer being rarely (never) taken into account.
• The advisor does not play her role of intimate assistant in the moments of life, which is the true expectation of individual customers.
• Digital self-services are not up to the standards imposed by mobile applications, forcing customers to go back to the agency. Patrice Bernard even judges it a “failed digitalization.”

These criticisms, clearly exposing a crisis of confidence, show the inability of financial services to properly exploit data for the benefit of customer service (because despite GDPR, it turns out that customers consent to the exploitation of their personal data in return for a quality, personalized service with real value).

So, are banks ready to disappear to survive?

This is a legitimate question considering the many developments in generative and conversational AI. Indeed, it now seems to be a given that sooner than later, various “chats” (ChatGPT typically comes to mind first, but it is not the only one) will be much better advisors than the one we can find in a branch.

Better trained, better informed about customer habits, available, visionary… it may not be able to replace the expert in wealth management, but it is quite capable of dethroning the generic advisor who is unable to understand his role in the customer relationship.

So yes, we have to anticipate this new paradigm in which the customer relationship could be managed by an AI-powered advisor. How can a bank survive in this ecosystem?

Shifting to a disintermediated model

One answer may lie in a bank’s ability to disappear, at least on the front end, to accept disintermediation, give up direct interaction with the customer, to dissolve into the moments of life in order to retain control of historical financial services.

Because a bank is a service provider, a function that takes its importance in a larger moment of life.

Accepting this relegation and becoming a service provider for a transactional, generative AI capable of taking on the role of life advisor requires a controlled, secure opening of a bank’s core system.

Of course, as you may have guessed, it is up to APIs and API management tools to take on this role. But this openness does not come without an additional layer, capable of opening up interaction with AIs.

Read more about how banks are evolving as API providers.

Marketing APIs to developers… and AIs?

In today’s world, this requires marketplace tools that transform the technical API into a digital product. These DSM (Digital Service Marketplace) 1.0’s, which showcase digital services for business developers and human developers, will have to evolve, transform, to simplify their discovery (parsing) by AIs and the consumption of their exposed services.

How should they evolve? That’s the question, but one thing is certain, it will be challenging to optimize interactions that are very different from human interactions for this DSM 2.0.

Until now, the reference for banking services exposure was Stripe. It’s beautiful, attractive, and easy to sign up for a human. An AI doesn’t care about color, but it will have a harder time signing up for a paid plan.

We have just seen that OpenAI (the editor of ChatGPT) has announced its first AI-oriented DSM 2.0, which is called ChatGPT Plugin.

Expedia was the first to integrate its services in this DSM, quickly joined by other providers like Klara or Kayak for flight search. It remains to be seen when the first bank will join this DSM 2.0.

We’ve just begun to examine the importance of marketing digital products, and already a new field has opened up: marketing to AIs.

More great things to discover.

Read my first blog in this series: Why the battle for generative and conversational AI will be won on the API front.