DISSERTATION PROJECT REPORT

ON

“IMPACT OF CHATBOTS AND ARTIFICIAL

INTELLIGENCE IN CUSTOMER SERVICES:
A RESEARCH IN BANKING SECTOR”

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS

FOR THE AWARD OF THE DEGREE OF

Master of Business Administration

(Finance and Accounting)
Submitted By:
Sadaf Jamal
Roll No.- 2110019025337
Under the Supervision of
Dr. Amit Mishra

DEPARTMENT OF COMMERCE

UNIVERSITY OF LUCKNOW, LUCKNOW

2022-23
i
 DECLARATION

I, Sadaf Jamal, Student of M.B.A University of Lucknow, Lucknow, do hereby declare that the
Project Report on IMPACT OF CHATBOTS AND ARTIFICIAL INTELLIGENCE IN
CUSTOMER SERVICES: A RESEARCH IN BANKING SECTOR is the outcome and result
of my own study and has been carried out under supervision of Dr. Amit Mishra.

I declare that this submitted work is done solely by me and to the best of my knowledge; no such
work has been submitted by any other person for the award of post-graduation degree or diploma.

I also declare that all the information collected from various secondary sources has been duly
acknowledged in this project report.

PLACE: Lucknow

DATE: SADAF JAMAL

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 ACKNOWLEDGEMENT

This project Report was undertaken for the fulfillment of MBA Programme pursuing at University
of Lucknow, Lucknow. I would like to thanks my institute and my Supervisor Dr. Amit Mishra,
at University of Lucknow, for his invaluable help and guidance throughout my work. He kindly
evinced keen interest in my work and furnished some useful comments, which could enrich the
work substantially.

Secondly, I would like to thanks my parents for always supporting me in every phase of life
including studies and work. On the other hand, I am also thankful to my friends for providing help
and study material to complete this project work.In fact it is very difficult to acknowledge all the
names and nature of help and encouragement provided by them. I would never forget the help and
support extended directly or indirectly to me by all.

SADAF JAMAL

iii
 ABSTRACT

Chatbots are smart tools that help customers solve problems and respond accordingly. It is a virtual
assistant that provides a 24x7 customer experience that helps customers solve problems they face,
making it feel like they are having a human conversation.
Chatbot is easy to measure to manage customer requests and increase customer satisfaction with
instant responses. After performing a data analysis, GAP aims to improve artificial intelligence-
based customer interactions through user compatibility and feedback.
Therefore, the purpose of this study is to use and familiarize chatbots for all customers with free
access to personal services of the bank.
The motivation behind chatbots is to help banks save on customer service costs by increasing
response time and answering routine questions. Data were collected through empirical research
and preliminary research, including a 100-person questionnaire. Our study offers a new
perspective on the emergence of skills-based customer service as a key to research. Artificial
intelligence-driven conversational robots or chatbots will be able to understand customers better
than humans and get the most out of customer interactions.

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 TABLE OF CONTENT

Title Page no.

Declaration ii
Acknowledgement iii

Abstract iv

Chapter-1 1-47

Introduction

Chapter-2 48-53

Literature Review

54-78
Chapter – 3
Research Objective & Methodology
Data Analysis and Interpretation
Chapter-4 79-80

Findings

Chapter-5 81-83

Suggestions and Conclusion

Bibliography 84

Annexure 85-89
• Questionnaire

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 CHAPTER 1
INTRODUCTION

1
 INTRODUCTION

The liberalization of trade and the changes that followed the globalization process had a
significant impact on the financial sector.
BankTech tries to share its silent analysis of BankTech's current situation and new trends.
Banks are working to digitize India by using new technologies and promoting a variety of
products and applications to improve customer convenience. With the number of mobile
phones, including smartphones, exceeding 1 billion in the country, banks compete to offer
their customers the best solutions for payments and other banking services anytime,
anywhere.
It is very important for everyone to benefit from the bank's facilities and services in daily life.
Many customers encounter problems with various processes, procedures and service related to
them. Banks benefit from the creation of a direct-to-consumer environment, the growth of
banking services, the distribution of offices and users. products require faster responses,
improved control and increased use of technology and trust.
Customers have questions about various banking services related to deposits, funds transfers,
Demat account opening, mutual funds, quick loans, debit and credit card related issues. This
causes banks to intervene unnecessarily to solve minor problems. Often, banks encounter such
problems by repeatedly asking customers questions.
This wastes time and can be frustrating for most bank employees. Repeatedly ask the counter
service and staff. So this reduces the work and jobs of workers.
That's why chatbots and artificial intelligence are here to play a role in cost and time savings
for employees and customers.
Will eliminate some jobs while improving operations and creating jobs in banking.
Based on the analysis of the three main chains of the financial services industry (bank
insurance and capital markets), this report will explore the impact of artificial intelligence
technology on various industries, operations and activities and predictably further impact the
overall performance of the financial services industry. finance. The banking sector is expected
to benefit the most from the integration of artificial intelligence systems in the next few years.
Analysts predict that AI will save the banking industry more than $1 trillion by 2030.
Financial institutions expect to see a 22 percent reduction in operating costs of AI.
Technology has become an essential part of our lives and affects many things we do.

2
One of them is banking. AI in banking is not just a new technology. The technology itself is
getting smarter, enabling more and more banks to use artificial intelligence for a variety of
applications. The banking industry has become one of the first consumers of artificial
intelligence. Banks research and use technology in different ways.

History and Evolution of Artificial Intelligence

Through history we have seen three significant industrial revolutions so far. The first
revolution started in 1784 when we saw the first steam engine. The second revolution was in
1870 when we saw the start of electricity. Third revolution was the IT revolution in 1969, and
we are now witnessing the fourth revolution, AI (Skilton & Hovsepian, 2017). The fourth
revolution is about big data, intense automation, and a world where everything is connected
based on AI technology.

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The Global Growth of the Artificial Intelligence Industry

From 2000 to 2016, the United States has been a dominant player in AI technology. It has
3033 start-ups and accounts for 37.41% of all AI start-ups in the world (Buchanan &
Cao, 2018). This accounts for 71.78% of total global investment.
It is also the first country to invest heavily in technology. Between 2012 and 2016, the US
invested $18.2 billion in technology, $2.6 billion in China and $850 million in the UK.
However, since 2017, the main position of the USA has been replaced by China, which
has started to invest heavily in this technology and exceeded the total American budget
(CB Insights, 2018).
In the Asian market, China leads the way with 68.67% of AI startups in Asia over the past
five years.
In terms of number of patents, the number of intellectual property patents in China has also
surpassed the United States in the last five years. China dominates the field of "machine
vision", holding more than 55% of the world's total number of patents. Machine vision,
which means facial recognition and object recognition, is widely used in areas such as
driving, e-commerce, public safety and health.
There are two main reasons for the explosive growth of intelligence over the past few years.
First of all, the amount of information available has increased. Today, we produce 2.5
terabytes of data every day, 90% of which has been created in the last two years. Second,
the increase in computing power and data storage has opened up many opportunities for
us to create new solutions.
In the last five years, we have created 5,154 AI startups worldwide, an increase of 175%
over the past 12 years (Marr, 2018).
What is interesting is the growth of cross-border trade. China has often invested in Chinese
businesses before, but as the chart below shows, China is investing more in US AI
startups than America does in US startups. The chart below shows how the gap between
the two has widened since 2015. From these two charts, we can see that the United States
still has the largest number of AI startups and the highest value jobs.
But they are slowly splitting international contracts for new AI centers outside the US.

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 Global AI hubs outside the US & cross border AI deals

One of the reasons China has increased its business in artificial intelligence is that they have
access to a lot of data, which is the most important part of machine learning. For
example, WeChat has about a billion users who generate information every day. Second,
they are a major supplier of artificial intelligence chips and leaders in facial recognition,
enabling their growth.

We need chips in every technology. Currently, China and the USA compete fiercely in the
field of artificial intelligence chip technology.
Alibaba developed its first AI chip and announced its first self-developed AI chip for cloud
services this fall (Horwitz, 2019). The chip, called Hanguang 800, is the world's first AI
thinking chip. Alibaba now uses a built-in chip to improve product search, personalized
recommendations on the web, and automatic translation. Alibaba's chief technology
officer, Zhang Jianfu, said the chip represents an important step in new technology for
both companies that could boost computing power and improve operational efficiency.
Interestingly, they also stated that they will not sell the chip as a product.
The chip was developed by DAMO Academy, a research institute founded by Alibaba a
few years ago.

AI technology is advancing fast, but now Facebook and Google continue to develop their
own AI chips to improve the performance of AI functions in their respective data
domains. There is still a big difference in the focus on AI between American and
Chinese companies. Companies like Tencent, Alibaba, and Baidu focus on AI research

5
 and image recognition, while Google, IBM, and Microsoft focus on machine learning
and conversation. In 2017, the "State Council of China" announced its plan to become
the world leader in artificial intelligence by 2030.
Their forecasts predict that by 2020 Chinese companies and research will be on par with the
US. As a step towards this goal, the Chinese government established a "Smart Industrial
Park" in Tianjin and provided $16 billion in funding to support the artificial intelligence
industry (Chen, 2018).
Europe, on the other hand, lags behind in the AI community and the gap between Europe
and China/America continues, according to McKinsey's 2017 digital research (Bughin et
al., 2019). Europe's GDP is comparable to that of the United States and slightly higher
than that of China.
In terms of the digital part of the ICT industry in Europe, we see that this is only 1.7% of
GDP compared to 2.1% in China and 3.3%, which is half of the US GDP. Europe, on the
other hand, is quite capable of intelligence.
For example, Europe has more professional developers than the United States, with around
6 million developers. The European Commission is taking the AI situation seriously and
is establishing public and private funds to invest €20 billion per year over the next ten
years (European Commission, 2019).

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 BANKING

Individuals or companies working in the business of raising money and receiving applications
for clients have to make cash payments from clients from time to time.

BANKING SERVICES

All activities involving accepting and retaining money from other individuals and
organizations and then lending money from the proceeds.

BANKER

Persons employed in banking institutions and engaged in various banking services and
financial transactions whether or not they have capital.
A banker ... is a business owner who buys money or money and debt by creating other debts
and replaces his credit with future debt, that is, the debt must be paid off as needed.

ARTIFICIAL INTELLIGENCE

Meaning
The theory and development of computer systems capable of performing tasks that normally
require human intelligence, such as visual perception, language recognition, decision making,
and translation of words. "Artificial intelligence is a field of computer science that deals with
creating intelligent machines that behave and react like humans."
Definition

Artificial intelligence is a computer system that runs machines efficiently and intelligently,
similar to how the human mind works.

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 MACHINE LEARNING

Machine learning is an application of artificial intelligence that provides machines with the
ability to learn and improve from experience without being specifically designed. Machine
learning focuses on developing computer technologies that can access data and use it to learn
on their own.
"Machine learning is the discipline of artificial intelligence based on the technological
advancement of human knowledge. Machine learning allows computers to process new
situations through chemical analysis, personal training, assessment and experience".

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9
 CHAT BOTS

Chatbot is an artificial intelligence that simulates a human speech using pre-calculated user
and audio or text-based characters. Chatbots are used in customer service and marketing, often
found in chat centers and instant messengers.

MOBILE BANKING

Mobile banking is the use of a mobile phone or smartphone or other mobile device to perform
online banking activities such as account balances, balances, remittance account balances,
paying bills and locating ATMs away from your home computer. The dynamic
Financial Services and Insurance (BFSI) industry is the largest buyer and implementer of the
technology. Now adopting technology in this field, "chatbots" have started to gain importance
in the Indian banking sector as they provide quick and personal responses to people. So, what
is a chatbot? A chatbot is a program that supports human interaction via text or voice or both.
Chatbots have the ability to facilitate interaction between any organization and its users with
minimal human interaction. MIT professor Joseph Weizenbaum first introduced it in the
1960s when he called it "ELIZA," and it has come a long way since then. Chatbots can now
be divided into two types: Rule-based and AI (Artificial Intelligence-Based), the first one uses
only the pre-answer to pre-answer the question, so it does not respond. It tackles complex
problems and enables self-awareness and human-like interactions. Another advantage of this
chatbot is the ability to learn from the user experience and thus get better over time, a prime

10
example of this is Alexa.
The adoption of chatbots in banking can bring many benefits to banking customers by:
1. It helps in Answering the Frequently asked Questions-Frequently asked questions such as-
What is my bank account balance?
What are my last 5 transactions?
What is the loan interest rates?
Chatbots make it easy to answer, so customer service representatives can spend time solving
complex problems rather than spending time answering these questions.
It assists the Banks Marketing Department
Chatbots can help banks develop better marketing strategies by collecting and analyzing
customer feedback in real time. Chatbots can also work as a way of facilitating the loyalty of
potential customers or prospects to the bank's sales staff for banking services.
It facilitates Core Banking Activities
State-of-the-art chatbots assist banks with basic banking tasks such as collecting EMIs in a
chat window. Additionally, customers can interact with the chatbot to apply for loans, transfer
funds, pay bills and more.
4- 24*7 Customer Care Support
In the dynamic age, helping customers in a personal way is key to growth, banks can provide
24/7 customer service support through chatbots to stay competitive in the market and thus
retain customers.
Cost Saving
A report released by Juniper stated that chatbots will be responsible for over $8 billion annual
cost savings by 2022. Chatbots facilitate banks to save their cost as they require just a one-
time investment which is less costly than employing a dedicated customer care executive ’s.
Appropriate for Customer Interactions-
Research shows that customers perceive phone calls as difficult and slow, while email is a
poor form of communication. In this case, chatbots can provide fast and personalized
customer service. Given the advantages offered by

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Chatbots, many Indian banks are leveraging them with Bthem. Below are the popular chatbots
adopted by banks in India -
Eva by HDFC Banks - HDFC Banks Eva (Electronic Virtual Assistant) is the most important
and largest AI powered Banking Chatbot in India.
Introduced in 2017, chatbots provide instant information by talking to customers, enabling
them to serve customers better and faster. It saves customers the hassle of searching,
searching, clicking buttons and making phone calls for information. It will also be able to
perform banking transactions in the future. He can talk to more than 20,000 customers a day
and has solved 5 million questions.
SIA by SBI Bank - In 2017, SBI, India's largest public sector bank, launched SIA (SBI
Intelligent Assistant), an artificial intelligence-based chatbot that can answer 864 million word
searches per day related to education, home, car and personal. it took. Ask for a loan. This
multilingual chat can respond with text or voice in 14 languages.
iPal by ICICI Bank - In 2017, ICICI Bank launched an artificial intelligence-based chatbot
called iPal, which provides instant solutions to all customer queries on its mobile banking
application iMobile and its website. It supports all local languages, voice support and APIs
with platforms like Google Assistant, Siri and Facebook Messenger.

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 NEW BANKING TECHNOLOGIES /APPLICATIONS

Blockchain Technology
Blockchain technology will revolutionize banking and financial services. It distributes
banking from a central organization to a large computer network. Financial transactions are
broken down into encrypted data, which is then added to the "chain" of computer code and
encrypted to improve cybersecurity. According to Wharton, there will be no word to ask about
replacing blockchain banking services, as the new technology has the potential to improve
many aspects of banking services and forms the basis for other banking technologies like
Bitcoin, but there are questions about when. University of Pennsylvania School.

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 Upgraded ATMs

The ATM (Automatic Cash Machine) revolutionized machine technology when it was first
introduced in 1967. The next revolution in ATMs may well be contactless payments. Just like
Apple Pay, Google Wallet and soon you will be able to make a contactless ATM on your
smartphone.
Some ATM updates are already available abroad. Biometric authentication is already used in
India.
This technology can help overall banking security by preventing ATM fraud and theft.
Eliminate unnecessary fees at ATMs.

Proliferation of Non-Banks

Banks hope the technology will enable them to provide faster, more accurate information and
better service to customers. Most of its resources should be devoted to meeting security,
compliance, and other business-specific requirements that allow non-banking providers not to
be regulated by banking services.

Apple Store-Style Experience

Future shopping experiences will be like shopping in supermarkets and Apple stores. Today's
banking customers find help tailored to the individual, as many people can now easily
download banking apps or easily find an ATM for banking transactions.

The bank wants to increase sales and customer service in the future, and sees this change as a
way to give customers direct access to the bank and its products, just like the Apple Store.

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 Automated Financial Services Employees

Finance experts say that up to 30 percent of banking jobs could disappear in the next five
years due to technology advances such as robotics in banking services. Many workers at
Wall Street, at large corporations and corporations, have already changed or found other jobs
due to the use of technologies like machine learning, chatbots, and cloud computing for their
jobs.

Mobile and Digital Banking

The mobile and digital transformation of banking has begun and growth has already exploded.
Banks are investing more in digital technology that allows customers to access banking
services via mobile phones, websites or digital platforms. In banking solutions like chatbots,
machine learning, AI can often help customers with simple things like making payments. In a
Forbes survey of banking customers, 86% of banks said banking services are their top
technology investment.

Partnerships
Although banks invest heavily in technology, the fastest way to be successful in financial
transactions in the future will be to form effective partnerships.
Fast-growing companies that already have new financial technologies or social media
platforms can be good partners for traditional banks looking to support their customers.

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 Wearables

According to Samsung Insights, wearables like smartwatches should be the future of the retail
experience. For example, a bank can use a Bluetooth beacon to send a personalized greeting
message to a customer's smart face when the customer enters the banking location.
In general, the behavior of consumers and smart products is simply the management of the
economy. More and more, remote technology will allow you to interact directly with your
bank, visit a branch from your email inbox, and you can expect to experience more insight
into new customers than you might expect in the morning. Another useful tool could be smart
glasses for bank trainers used in the bank, which can process financial information for
employees while they work for others.
Digitization
AI applications include digitization to streamline banking services and improve products. This
creates better communication between customers and suppliers, and digitizing information has
reduced problems that weren't there before. Digitization refers to increasing the efficiency and
development of the bakery industry through the use of digital technology and the content of
digitized information.
Data based Artificial Intelligence applications

With the help of applications installed on personal robots, end users and financial institutions,
big data can be analyzed effectively, helping to predict, forecast and follow financial advice.
These apps provide access to financial planning and ideas through education and research,
including loans, interest rates, progress tracking, and investment resources.
Personalization

The personalization of banking services will help clients make better financial decisions
through technology and financial planners and advisors. They make recommendations on
products and contracts after analyzing the business model based on the client's financial goals.

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 Digital Wallets

Digital wallets are becoming the future of payment technology, with apps like Apple,
PhonePe, Google Pay, Paytm and more. This reduces the dependency on physical cash and
takes the value of the currency to the next level. The rise of digital wallets has increased the
use of technology.

Voice Assistance

While voice assistants are disappearing from the body, artificial intelligence enables
customers to use banking services via touch screens and commands. The Interactive Customer
Service Center (IVRS) helps process requests to answer questions, connect users to various
banking services and provide necessary information. This reduces the number of errors caused
by human causes.
Customer support
Most banks are creating a customer-centric culture with advances in machine learning, natural
language and intelligence to improve the customer experience and differentiate themselves.
All these are very important for banks to make their customers happy, to provide better
service and not to wait in line at the bank in the future.

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 TYPES OF BANKING SERVICES

In the modern world, banks offer a various types of services to attract customers.

Foreign Currency Exchange

Banks hold foreign currency. It is important for banks to convert foreign currencies to local
currencies at the request of their customers in order to solve the currency problem for
international trade. Foreign currencies can now be bought and sold online.

Consultancy
Businesses today are large organizations. Banks can expand their capacity for advisory
services. In this study, banks provide customers with investment, trade, economy, income,
taxes, etc. It hires financial, legal and business professionals to advise on matters.

Bank Guarantee
Commercial banks and public banks offer bank guarantee facility to their customers. When
the customer is required to deposit some money in the government or court for a special
purpose, the bank may act as the customer's guarantor rather than depositing the money from
the customer.

Remittance of Funds
Banks, customers' checks, money orders, etc. It helps to move money from one place to
another. Banks also offer electronic check withdrawals from ATMs and request drafts via
online withdrawals.

Credit cards
A credit card is a card that allows the cardholder to purchase appropriate goods and services in
exchange for instant payment of goods or services from a credit card, and on which the
cardholder undertakes to repay the purchase price to the card issuer in a timely manner time.

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 ATMs Services
ATM machine replaces human bank account to perform banking functions and services such
as deposit, withdrawal and balance inquiry. The main advantages of ATM are:
24 Hour Withdrawal Fees Transaction
Convenient location saves more time.

Debit cards
A debit card is a card used to electronically withdraw funds directly from the cardholder's
account. Most credit cards require a personal identification number (PIN) to verify
transactions, and biometrics is required for future credit card withdrawals.

Home banking
Home banking is the process of doing banking and financial transactions in your home instead
of using a bank account, account inquiry, transfer, movie ticket order, payment, loan request,
deposit etc. includes transactions.

Online banking
Internet banking is a service that banks offer to their customers and allows account holders to
access their financial information over the Internet. Online banking is also known as "online
banking" or "online banking". Online transactions from private and public companies allow
customers to handle all day-to-day transactions such as wire transfers, balance inquiries,
payment and cancellation requests, and some also offer online credit and credit cards.
Account information can be accessed anytime, anywhere.

Accepting Deposit
Deposit means that it is the main responsibility of banks to accept deposits as deposits from
depositors or depositors. Banks take deposits from people who can save money but cannot use
it profitably.
People like to put their savings in the bank because it earns interest and saves money.

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 Priority banking
It may include services such as advanced banking, online payments, free checking, financial
advice and information. Today, the central bank offers important banking services to new
customers as a promotion.

Private banking
Digital banking for financial management Personal finance and financial services for High
Net Worth Individuals (HNWIs). The main purpose of
Private Banking is to manage individuals and provide the most suitable options for these
individuals.

Advancing of Loans
A bank is a non-profit business organization that provides advance loans to customers. Banks
are required to lend to the public and earn interest based on their income. After accumulating
some cash, banks can offer short, medium and long-term loans to people in need of loans.
Overdraft
Banks open overdraft accounts to customers, allow customers to withdraw more than their
deposits, and pay customers interest based on overdrafts.
Discounting of Bills of Exchange
This is another type of loan provided by banks. Through these services, the holder of the bill
of exchange receives a discount from the bank, and the debtor accepts the bill of exchange
from the creditor and agrees to pay the said amount in due course. After deducting some
marginal amount, the bank pays the value of the note to the customer or the bearer.

Check/Cheque Payment
The bank issues a check to the banker. Bankers can deposit checks through ATMs, a new
service offered by the banking industry to better serve customers.
A bank pays a customer's check after it has been accepted by a bank teller.

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 Collection and Payment of Credit Instruments
In today's market, banks, money orders, checks, checks, bank statements, etc. It processes all
types of loans. Today banks charge and pay fees for different types of loans, and that's what
banks do today.

Introduction to AI
The invention of computers made people work smarter. This journey will continue with research
and development to improve operating speed, application and hardware. In the process of
widespread use of computers, many schools of thought have emerged about whether machines can
think like humans. This thinking gave birth to artificial intelligence (AI), which creates intelligent
machines like humans. The term "artificial intelligence" means "man-made" and "intelligence"
means "the ability to think".
It is also known as "artificial potential". In general, artificial intelligence is defined as a machine
that exhibits intelligence. It is used to develop human skills such as learning, understanding,
reasoning and problem solving. John McCarthy defines artificial intelligence as "the science and
engineering of making intelligent machines, especially computers".

In the era of decentralization, digitization is shaping industries more broadly.

The shift of the current generation to the digital environment, which connects thousands of
customers with digital technology, has led to the customer's need for services and products in

21
technological standards. The PwC report shows that many businesses are investing in digital
technology and new business opportunities are increasing. Artificial intelligence is part of this
development, creating intelligent machines and computers that bring many changes to the world
economy and open up new opportunities for business. As expressed by the phrase "must be the
mother of invention", technology has affected people's lifestyles and thoughts and changed the way
people interact online. The ability of artificial intelligence to process large amounts of data more
efficiently than humans have attracted businesses, which has led to increased demand for the
technology.
Researchers say artificial intelligence will have a huge impact on business. 0.5% of the world
economy is produced by the five developed countries (Accenture) and this figure will double by
2035. Global spending on AI applications exceeded $5.1 billion.
Globalization and technological development have increased consumer expectations.

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Introduction to CHATBOT
Chatbots are virtual agents used as front desk agents to provide customers with interactive and
customized experiences. Chatbot is an artificial intelligence-based computer program that supports
conversations or conversations with real people through messaging apps and websites.
Conversations between humans and chatbots can take place in the form of text and conversational
conversations that are not limited by time and space. Problems such as waiting times, long waits
and lack of service personnel are avoided for the customer. Virtual agents such as chatbots provide
relevant information and respond promptly to customers.
According to forecasts, the chatbot market size should reach $102.29 billion by 2025. According to
And Juniper Research, the success of bot interactions in banking should exceed 90% by 2022,
2020. chatbots, IM bots, interactive chatbots, chatbots or chatboxes.

EVOLUTION
While we've seen practical applications of AI recently, the history of AI goes back to the 1950s,
when Alan Turing published an article on the promise of AI in the machine. The concept of
artificial intelligence did not develop until the late 1990s, but there is no such thing as artificial
intelligence.
The speed of artificial intelligence in business applications only increased after 2011 when big
technology companies such as Facebook, IBM, Microsoft, Google started to deal with artificial
intelligence and machine learning.

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ADOPTION
AI applications today include everything from data mining to algorithmic analysis to facial
recognition and optical behavior recognition. Advertising and marketing, business, insurance,
Internet, transportation, aviation, agriculture and genetics are just some of the industries where AI
is currently used. In the 1990s, new technologies focused on artificial intelligence research that
improved the ability to think about natural language processing, image recognition, deep learning,
speech recognition and recognition. It is used by several new companies to attract business interest.

THE FUTURE OF ARTIFICIAL INTELLIGENCE IN BANKING

In the future, with the development of artificial intelligence technology, artificial intelligence will
become stronger so that all customers can enjoy safe trading. AI will lay the foundation for
productivity and create new jobs. AI also has the potential to transform customers and create new
business models in the banking industry. To achieve maximum benefit, humans and machines must
interact, which will require future consideration of education and banking. Additionally, large-scale
reform is key to unlocking the great potential of the future that can be achieved with technologies
such as artificial intelligence and blockchain.
Banks are tapping into the potential of artificial intelligence to introduce new customers through
multiple solutions and set new standards for the Indian financial industry, thus setting the new
course through rigorous technology. Convert data into digital format using smart tools. It also helps
improve customer service. It helps customers and banks save time. It helps reduce human error.
It helps build strength and stability for clients. Facilitates transfers and withdrawals of large
amounts of cash. It facilitates cashless transactions anytime anywhere.

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The Need for AI Based Intelligent Assistance in Banks
The finance and banking industry sees AI as progress. The 2017 report by PricewaterhouseCoopers
found a positive trend in the industry. Now, the banking industry has changed dramatically. The
finance and finance industry has introduced artificial intelligence for several reasons:
• Due to the raise in competition and many players in the financial sectors.
• Need for customized solutions for the queries of the customers.
• Need for process-driven services.
• Requiring customized bank services.
• To increase profitability
• To secure and maintain the privacy of customer’s data.
• To enhance employee efficiency
• To maintain and deal with huge amounts of data
Artificial intelligence in banking provides the best service to customers and increases their profits.
The financial sector is said to benefit from this technology, which supports the foundation of the
economy. Four out of five businessmen say AI will change the business. Artificial intelligence
should assist humans in many tasks and in daily life. One of the tasks of intelligence is to reduce
errors and create accurate insights in data and draw conclusions that help customers and businesses.
Banks offer all channel strategies including internet, web or physical branches. Banks offer a
variety of digital services, including online banking, mobile banking, telephone banking,
neobanking, and self-service technology, among others. Banks are exploring the use of artificial
intelligence in their operations and customer support processes. India is a technology hub and home
to a large banking industry. Companies such as
Infosys and TCS operate in the fintech space.
Companies like ICICI, Axis and HDFC Banks organize hackathons and events for the best
innovations. The involvement of artificial intelligence in the banking industry has brought with it
many developments that can be seen in customer support, recruitment, communication and other
areas. Banks are finding many ways to improve, such as providing personalized services through
financial advisors and planners. These automated services analyze businesses and provide
recommendations based on customers' business and financial goals. Big players like Google, Apple
and PayPal have taken the risk of creating their own payment gateways by creating a cashless
environment called a digital wallet or smart wallet.

25
AI technology also helps customers make inquiries via voice commands and touch screens, known
as voice banking. Drive-thru banking allows customers to make banking transactions without
getting out of their cars. Voice AI is designed to replace people in the startup industry. The bank is
an efficient self-service hub that provides customers with a variety of electronic services such as
bill payments, government e-services, and more. Passport printing kiosk is a device that allows
customers to print passports.

26
Effects of AI on Banks
This has resulted in a shift of business models from bank-centric to customer-centric. This has led
banks to consider providing more user-friendly applications to increase customer satisfaction.
Technology has played an important role in helping banks transform and understand customer
behavior. According to an Accenture report, the technology will reduce business costs at the
company by 25%. AI improves the relationship between customers and service providers.
Now service providers can directly contact customers with their complaints. AI has opened the
door to many improvements in its services. In today's environment, customers want to get
something quick with less time spent, avoid long queues and get instant answers to their questions,
all companies make money to be available in virtual mode. Artificial intelligence has reduced
fraud, which has always been a threat to consumers and banks. AI is used in the front office for
transaction banking, in the middle office such as managers, directors and supervisors to prevent
fraud, and in the back office for credit commitment.
The use of fraud makes customers dependent on the bank and thus gains trust. This trust will
prevent the loss of customers.
The use of artificial intelligence in banks helps banks work efficiently and effectively. Artificial
Intelligence is used for the creation of reports and analysis, the use of artificial intelligence reduces
costs, increases revenue, effectively saves time and money. By adopting new technologies in
analytics, robotics, RPA and reporting, banks can reduce costs and risk as well as increase revenue.
The banking industry can reap many benefits as it helps increase revenue, reduce risk, improve
customer satisfaction, and more, using AI.

27
28
Ways AI Could be implemented in Banks
According to the application, artificial intelligence can be divided into three main categories.
Effects and Impacts of Artificial Intelligence Driven Intelligence 379 Artificial Intelligence
Narrowly (ANI). It is also called machine learning, weak artificial intelligence or narrow artificial
intelligence. It is used to solve specific issues in certain areas, such as product approval or weather
forecasting. Most applications today are ANI.
Some examples include narrow artificial intelligence such as voice recognition, weather
forecasting, fraud detection and facial recognition such as Alexa, Siri and Google Assistant.
Artificial General Intelligence (AGI). General intelligence, also called strong intelligence, is used to
solve common problems. AI thinks, acts, solves and responds like humans. AGI can perform tasks
for humans, such as Uber's self-driving cars and Tesla's Autopilot.
This is a future where artificial intelligence surpasses human intelligence. Artificial Intelligence
(ASI). The future of super artificial intelligence is unpredictable. The ASI system that goes beyond
human intelligence. Machines can do much more than humans can do on their own.

Effects of Chatbots in the Banking sector

These chatbots can handle high volume customer requests and are available 24/7, reducing the
company's operating costs. Global banks could save $7.3 billion by 2023 thanks to chatbots, which
will be 3 times more than in 2019. Reduced operating costs with chatbot services will benefit the
company with an estimated savings of $430.9 million in 2020. 2 dollars.
486 million in 2028, according to Grand View Research 2021.

Ways Chatbots could be Deployed in Banks a. Goal-based:

✓ It is designed to accomplish a purpose or task. Its purpose is to provide a quick chat and get the
job done. Banks use chatbots on their websites to provide excellent service to their customers.
✓ Known as: It is the collection or storage of information learned by the chatbot. The information
can be financial or company details about products or services provided to customers.
Knowledge-based chatbots are divided into open and closed lists. Responds to general terms in the
open field. Confined spaces focused on specific information and did not answer other questions.
✓ Service-based: It is based on the services provided to the user. It is classified as commercial or

29
personal.
Based on Response Generation: In this category, the chatbot responds based on response
generation.

Services Provided by Chatbots in Banks

Some of the services rendered by chatbots in banks are:
Availability of customer service 24/7: Customers can use the chatbot service center to do
business with the company or query company information anytime and anywhere throughout the
year.
User friendly: Chatbot services are designed to simplify banking processes for the benefit of
customers. These chatbots start conversations by trying to understand customer needs. Navigating
the process is user-friendly.
Increased productivity of bank personnel: Chatbots can effectively solve minor problems that
will help bank employees be more efficient at other pressing issues. This increases the efficiency of
customer support and helps companies focus on key issues that AI cannot solve.
Convenient mode of communication: In the rapid growth phase, people want to solve their
problems immediately without spending too much time and effort. Because chatbots can combine
various functions to facilitate customers of different age groups. It's easier for teenagers.
Personalized experience: Personalization is an important part of customer service and lets the
customer know before the conversation begins. Chatbots can access all data from existing
customers even before the conversion process begins, which helps build better customer
relationships. Chatbots automatically identify and identify customers based on their phone number,
login/password, authorization token, or other secure and reliable identification tool. In this way,
they can greet customers by name, communicate in their preferred language, share special services
and promotions, etc.

30
Description of Chatbot Services/Virtual Assistants in Different Banks in India
State Bank of India (SBI): SBI is now utilising an AI solution built by Chapdex, the winning team
in SBI's first national hackathon, "Code for Bank." On the front desk, using SIA chatbot, an AI-
enabled conversation assistant built by Payjo, a Silicon Valley and Bangalore-based firm. It
responds to client enquiries quickly and assists them with the day-to-day operations of the bank as
a representative of the bank.
Bank of Baroda: BoB has created a high-tech branch equipped with cutting-edge technology such
as the artificial intelligence robot Baroda Brainy and a Digital Lab with free Wi-Fi.
Allahabad Bank: In an earlier news release, Allahabad Bank stated that its app'em Power' will
undergo significant updates, including Chatbot and artificial intelligence-based e-Commerce
payments.
Andhra Bank: Flatboat, a Bengaluru AI company, has linked an AI Chatbot with Andhra Bank's
Core Banking Servers in order to digitally engage and manage customer support for 5 crore
customers. Flatboat will also boost Andhra Bank's internal chatbot, which has over 20,000 users
and is used for recruitment and programmed training.
YES Bank: Launched 'YES mPower,' a banking discussion for its credit facility, in collaboration
with Gupshup, a bot platform. The YES ROBOT product is another AI technology, which is used
to respond to consumer questions concerning bank issues at any location worldwide. In addition,
with the launch of YES TAG in April 2016, YES BANK became India's first bank to offer chatbot-
based financial services, enabling users to conduct financial transactions through popular social
media platforms.
HDFC bank- "Eva," a chatbot powered by artificial
intelligence (AI) developed by Bengaluru Sense
ahead AI research, is now available. Eva can pull
data from tens of numerous sources and respond to
simple questions in under 0.4 seconds. In the future,
Eva will be able to supervise real-world banking
activities. HDFC is also working with shop robotic
capabilities, and the prototype robot IRA has been revealed ("Intelligent Robotic Assistant").
ICICI Bank - Robotic software was installed on 200+ business operations across numerous
functions of the organization, most of which were built in house and used AI capabilities such as

31
facial and voice identification, language processing, deep learning, bots, and others. ICICI Bank
computer bots are set up to collect and analyze information from systems, discover trends, and
carry out business tasks in a number of applications in order to perform duties. iPal, an AI-powered
Chabot, is one such tool that helps with answering questions, financial advertising, and identifying
new services.
Axis Bank: Introduces a cognitive payment gateway powered by artificial intelligence that uses
machine learning and natural to help users with financial and non-financial transactions, inquiries,
and marketing materials.
Canara Bank: Mitra, a humanoid robot developed by Bengaluru-based Invento Robotics to help
customers navigate the bank, was unveiled. Candi, who provides significantly less assistance to
workers than Mitra, is another possibility.
City Union Bank: The banking robot Lakshmi is unveiled. Clients can communicate with a robot
on over 125 different themes. The robot has been trained to connect to the primary banking service
without responding any of the typical questions.

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Statistics of Usage of Chatbots
Banks use chatbots in marketing, sales and customer relationship management to provide
customers with fast, cost-effective, personalized service. Only 19% of customers currently use
chatbot services, and it is expected that 95% of customers will use chatbot services in the future.
According to a 2019 survey by Statista, 13% of respondents globally believe chatbots are
ineffective in customer service, 54% believe chatbots are helpful to customers, and 33% believe
chatbots are very helpful to customers. .

BENEFITS OF ARTIFICIAL INTELLIGENCE IN BANKING

Here are some benefits of artificial intelligence in banking.
Achieve overall customer excellence The introduction of artificial intelligence has led to a
technological revolution in the banking industry, opening up many possibilities.
No Long Queues – The most common problem in banks is long queues. This problem can be
solved with chatbots and other virtual assistants.
Personalized Banking – AI assistants can use machine learning to help personalize financial plans,
offers, and loans to each client based on their past behavior, results, and zero scores.
Data-Driven Intelligent Insights – AI can analyze cash and other behavioral patterns to generate
reports that inform consumer spending.
AI also helps recommend products and services to customers based on their past behavior.

33
Improve customer experience with AI-based tools
Cost savings - AI can help reduce costs. Time to Solve Problems - Another advantage of AI is that
it saves time for both employees and customers.
Data-Driven Decision Making Precision Marketing - AI helps organizations create and implement
precise marketing plans.
Improve business - AI analytics can help banks improve operational efficiency.

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AI-driven risk management
Some of the ways AI can help banks manage and mitigate potential risks include: -
Assistance in informed decision making through predictive analytics - Many businesses depend on
outside world forces. Fraud, money laundering, natural disasters and political upheaval all play a
role. AI-driven analytics can help you plan and make timely decisions by providing a clear view of
what's to come.
Check customer's credit history - Artificial intelligence shows the risk of the application, usually by
calculating the customer's default on the loan.
• Fraud Prevention
• Better Investigations - Artificial intelligence can correct data errors that cannot be fully
investigated to prevent fraud in the financial industry.
Data and information lost during audits can be costly for banks. Artificial intelligence helps analyze
all data, while machine learning quickly detects dangerous data and information.
• Cybercrime Reduction - AI can be used to improve cybersecurity and protect consumers. AI
helps detect fraud or other unusual activity in customer accounts.
• Build an internal compliance system - AI-based internal systems can help ensure compliance in
the workplace.

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IMPACT OF AI IN BANKING
Banks use artificial intelligence (AI) systems to provide, predict and act on personalized financial
advice to customers with instant access to financial advice, loan rates and future business
development. Here is the impact of intelligence fraud on the banking industry:-
Customer Satisfaction: AI supports banks in providing convenient and efficient services to
customers, as well as improving revenue, decision-making and customer relationship management
goods.
Chatbots: Bot is short for Robot and chatbot is an automated conversation that runs or follows a
pre-programmed process. Chatbots are a type of artificial intelligence that can be used as financial
institutions. Chatbots are available 24/7 and provide exceptional customer support.
Personalized Financial Guidance: Artificial intelligence helps users make financial decisions
easily and quickly by using the latest information on current market trends and offering suggestions
on products and contracts message customers can invest in.
Digital wallets: Digital wallets allow users to use digital currency on their phones or computers to
buy anything online.
Interactive Voice Response Systems (IVRS): The voice machine works hand-in-hand with
customers, answering specific questions, searching for relevant financial institutions and providing
a great customer experience.
Fraud Detection: Artificial intelligence detects financial fraud by analyzing transactions through
transaction data and monitoring differences in behavior or activity. AI can reduce financial fraud,
speed up processes, prevent security breaches, and facilitate machine learning.
Improving customer service: Customer satisfaction affects the performance of the banking
industry and affects people's views of financial institutions' products. It also has an impact on the
company's customer targeting and retention efforts.
Better regulatory compliance: AI applications often rely on fraud analysis to analyze customer
usage, analyze transactions, detect suspicious behavior, and measure the effectiveness of different
compliance measures. AI brings significant benefits to customers through automation, reducing
risks and costs, increasing employee productivity and enabling enhanced compliance.
Risk management reduces fraud and effectively reduces risk for risk assessors by analyzing
transactions in real time for suspicious patterns, measuring customer loyalty and providing
feedback.

36
Portfolio Management: Artificial Intelligence systems and machine learning technologies create
personalized portfolio profiles for customers based on their limited resources, personalities and
preferences. Business finance and AI are on the verge of the next wave of digital disruption.
AI thus changes many areas of the banking process, making returns safer and returns more
efficient.

37
 ADVANTAGES AND DISADVANTAGES OF AI IN BANKING
ADVANTAGES:

Better Customer Support

Much evidence suggests that customers prefer personalized service that allows them to talk to
a virtual assistant as if they were a live customer representative.
Most companies instantly add virtual assistants to their websites with chatbots, machine
learning, voice response, and mobile apps. AI sees every interaction as a teachable moment,
so chatbots (virtual assistants) get better at learning about customers. With the help of
artificial intelligence, virtual assistants can provide better and better support to customers. It
also allows for emotional analysis, so the virtual assistant can identify when someone is angry
and immediately switch to the agent.
Enhanced Banking Services

AI improves banking processes while serving customers more easily. It enables banks to meet
customer needs with technology and digital support. With artificial intelligence, you can
achieve more and more accuracy and accuracy. From cash transfer to bill paying, online
booking, card management and other support, AI can improve customer satisfaction. All these
functions can be easily controlled from desktop computers, smartphones, electronics and other
mobile devices.
Scam Recognition

With the rise of banking fraud, detecting and reducing fraud has become a challenge for the
banking industry, and artificial intelligence can make it happen. Many banks failed to identify
relevant and effective solutions. But AI can more easily detect fraudulent cases and empower
investigators. Enhances financial security with advanced fraud prevention strategies. Artificial
intelligence as a real-time fraud solution in the banking industry when dealing with complex
problems and ideas.
Artificial intelligence can detect fraud through unusual transactions based on advanced data

38
analysis. It also creates a secure banking environment by providing feedback to the customer's
personal information.
Reduction of cost

Banks are adopting new technologies to reduce banking costs and using general learning and
neural networks used in artificial intelligence to learn new things like humans. In this way, the
machine eliminates the need to enter a new code each time.

In Banking

In data Analysis in Baking: Artificial intelligence can easily consume and process
large amounts of data Through the machine learning, at an expedited level.
Fraud Detections: Most of the business and banking industry has used new technology
to detect fraud and thus improve the business performance of the company, the whole
world web is easy for fraud users and banking is no exception. But AI learns and
monitors user behavior to identify anomalies, warn of signs of fraud, and gather the
evidence needed to make a decision.
Advanced Data Analytics

One of the main benefits of intelligence is the ability to complete complex tasks through
complex tasks, thereby increasing productivity. Artificial intelligence based on machine
learning algorithms can be used quickly and can process large amounts of data. Ultra-fast
efficiency of business and financial services, providing personalized service to customers.
Machine learning enables faster decision making while working fast.

Smart Wallet

San Francisco-based startup PFM (Personal Financial Management) is developing an AI-

based smart wallet. This helps customers make informed decisions when spending their
money.

39
 DISADVANTAGES

Artificial intelligence is also expected to massively afflict banks and traditional financial
services. Some of its disadvantages are listed below.
Highly Expensive

For small banks, AI is expensive to build and maintain because they are very complex
systems. AI also includes advanced software programs that must be updated regularly to meet
the needs of a changing environment, thus affecting costs. In the event of a major failure,
system restore and lost code recovery will require more time and cost.
Spam Calls

AI can learn and evolve, but still can't make decisions. People can take personal situations and
decisions into account when making decisions in ways that intelligence cannot. Changing
human behavior with intelligence can lead to unconscious behavior and conflicts in
ecosystems of humans and other species.
Distribution of Power

There is always a concern about artificial intelligence guiding or guiding humans. Artificial
intelligence can give too much power to the few people who control and cause fraud. While
intelligence dehumanizes character in many ways, it creates risk and control away from
people.

Unemployment

Replacing jobs with machines can cause a lot of unemployment in the financial sector.
Moreover, if the use of artificial intelligence becomes too rigid, people will become dependent
on machines and lose their creativity and intelligence. Unemployment led to a slowdown in
the Indian economy. As technology advances, every action of a person can lead to the
destruction of his mind. commercial or otherwise non-commercial; artificial intelligence can

40
lead to successful unemployment.
In the bakery service sent to the wrong people, the information coming from artificial
intelligence can pose a threat to people. If people start wanting to destroy it, they can make a
hodgepodge with advanced technology.
Can’t think out of Box:

A robot is indistinguishable from any algorithm or programming done on that machine. They
can only do what they were designed or programmed to be limited to the device, and as the
new technology is being adopted by the service, we can't do it out of the box.
Addictions
We rely on technology to improve the efficiency of the bank's daily operations. For example,
instead of washing our hands like before, we wash our clothes in the washing machine or they
put the dishes in the machine, which is laziness.
Most people nowadays use Siri, Cortona, Google Assist, etc. rely on apps. If we do not need
our ability to think, they gradually reduce human thinking.
Exploitation of artificial intelligence

Improper use of force is very bad. But for machines, the situation is even worse. We often
hear that the misuse of technology can cause great harm to the world.

Self-Modify
Self-modification, combined with self-replication, can lead to dangerous, undesirable
situations such as new and frequent computer viruses.
The problems arising from the emergence of artificial intelligence are many. But AI is equal
parts intelligence and imagination, and it's constantly evolving. Artificial intelligence gives
banks, financial institutions and technology companies a competitive advantage. It can change
business and make it faster, but only if the financial industry can manage the security of AI-
based systems.

41
 MOBILE BANKING WITH ARTIFICIAL INTELLIGENCE

Intuitive Interface

Interface design should be both smart and technological. Keep all screens simple and clean
and enlarge buttons, numbers and text.

Visualize Information

Banks present annoying financial pictures with lots of numbers and letters. A good banking
app focuses on functionality, while a good banking app "adorns" unnecessary information and
makes it as visually appealing as possible.
Quick Balance

Users do not need to log in, just swipe to see account balance. This type of transaction can
help customers at the bank access balances.
Transaction Details

Today's apps don't just show the price. Shows the recipient's full contact information,
including address, phone number, email (with click-to-call option) and where to pay.
Account Security

Banking-related applications manage security better than traditional passwords, and users can
choose between fingerprint ID or gesture-based password methods for biometric
authentication. This type of security hides account owner details.
Debit Card On/Off

As a feature of the mobile banking app, the credit card can be locked or unlocked with one tap
for security while the real account itself remains open.

42
 Customer Service

We can quickly get help from a personal banker or make an appointment with a financial
advisor at a private bank. Users should be able to search for questions and video tutorials for
help without having to speak to anyone.
Mobile Photo Check Deposit

Mobile Photo Check Deposit makes it easy to fund your account anytime, anywhere using
your mobile camera. This is a must-have app feature.

Mobile Photo Bill Pay

Mobile banking app users can snap a photo of the invoice and the app will send all necessary
payment information so they can set up a one-time or recurring payment within minutes.
Branch/ATM Locator

Users should be able to accesses the locate of your financial institution’s branches and ATMs
based on either their current GPS location or a search function. Results should shows the
baking hours of operation and phone numbers, photos of branch. It’s very helpful to
customers.
Personal Financial Management Tools

User can see the aggregate and manage money with goals, spending alerts, spending
categories and visual tools.
Safe-to-Spend

Users can use their balances in different formats, eliminating fraud. Knowing exactly how
much you should spend is another. Users should know how much money they have left after
depositing for payment plans, remaining work and savings goals.

43
 Receipts

Users can take pictures of receipts on their phones to help them keep track of expenses. This
is the main Advent feature.

Person-to-Person Payments

Users using such applications can send money quickly and securely to any person at any time
using their phone number or email address.
Travel Notification

Users can learn what to do by notifying their bank accounts. Just swipe or tap.
Personalization/Customization

Users can view a list of their recent transactions on the account listing refunds. They can
customize menus, dashboards or interfaces to suit their needs/scenarios. They can edit their
profile by nickname, post ID, photo.
Credit Monitoring

The best credit check app for android phones shows user's credit score updated monthly.
Mobile Photo Account Opening

Users can take a photo of their driver's license and voter ID and start a new account in less
than five minutes. This is a useful feature when needed, but is probably rarely used.

44
CHALLENGES OF ARTIFICIAL INTELLIGENCE
❖ Not everyone understands what AI is- To demonstrate expertise in banking, it is necessary to
have a good understanding of the bank's resources and limitations, as well as its advantages and
disadvantages. Let's be honest, most people don't know what technology is or how to deal with
many banking problems. When people hear the word "intelligence," most images that come to
mind are robots taking over people. The problem is the misunderstanding of AI technology, which
hinders its adoption in many industries. People need to educate themselves about the AI problem
and it is now used to solve it.
Maybe a little, but it may not be necessary for technology to start opening the doors of our lives.
❖ Computer power- The power required for these algorithms is one of the features that hinders
many developers. Machine learning and deep learning are the core of artificial intelligence and they
need more and more cores and GPUs to be successful. Asteroid tracking, health referrals, cosmic
body tracking, and other areas where we have ideas and knowledge to use deep learning techniques
are just a few examples. They need the processing power of a supercomputer, and yes, these
computers are cheap. However, they come at a price, as the creator of cloud computing and
services can work with artificial intelligence systems with great success.
❖ Lack of Trust - Uncertainty about how deep learning predicts outcomes is one of the major
contributors to artificial intelligence. Understanding how cognitive processes can produce solutions
to various problems is difficult for the average person. Most people in the world are unaware of the
use or potential of artificial intelligence or how it is incorporated into devices like smartphones,
smart TVs, banks and even that car (automated to some degree).
❖ Information is scarce- Although there are many examples on the market where AI can be a
better alternative to technology. However, the underlying problem is that AI is not well known.
Few people, other than tech geeks, college students, and academics, realize the potential of AI. For
example, many SMEs can organize their work or learn new ways to expand their products, manage
resources, sell and manage products online, study and understand the behavior of users' products,
and respond to the business effectively and efficiently. They do not know about technology
services such as Google Cloud, Amazon Web Services.
❖ The level of the individual – This is one of the toughest problems in AI and leads to the first
run of AI services for businesses and startups. These companies can boast more than 90%

45
accuracy, but in all these cases people can do better. Doing the same job using deep learning
models requires a lot of money, the use of hyperparameters, large datasets, good and accurate
methods, and a lot of computing power, ongoing data in training, and testing test data. It sounds
like a lot of effort and is a hundred times harder than it looks.
❖ Data privacy and security- This is important because all deep learning models and robots rely
on data and training. Yes, we have information, but since it was created by millions of users around
the world, it can be used for malicious purposes.
❖ Grieving Issues- The amount of data used to train an AI system makes it seem like it's no good.
So the ability to get good data is the ability to respond to a good AI service. But in reality, the
organization of daily data collection is difficult and ineffective.
❖ Lack of data- Governments like India are enforcing strict IT laws to limit travel, as large
companies like Google, Facebook and Apple face allegations of data misuse. Therefore, businesses
now face the challenge of creating global applications using their data sources, and this can be
overwhelming. The recorded data is used to train the device to read and make predictions, which is
an essential part of intelligence. Some businesses are trying to innovate by focusing on building AI
models that can still deliver good results in the absence of data. If the data is skewed, the entire
system may be defective.

46
OBJECTIVE OF THE STUDY

1. To recognize which means and motives for Artificial Intelligence.

2. To look at the implementation of Artificial intelligence in Banking Industries.
3. To look at the wonderful and terrible influences of Artificial Intelligence in Banking
Industry
4. To know the advantages and disadvantages technology advancement in banking
services.
5. To know the present scenario of artificial intelligence in banks.
6. To know the positive and negative impact of technological innovation in banking
services.
7. To know the role of AI in banking services.
8. To study the impact of chat-bots on the banking experience.
9. To understand the perception of the customers on banking chat-bots.
10. To know about the fraudulent activities in banking services through onlinetransactions.
11. To find the conclusion and make suggestions on the base of the study.

47
 CHAPTER 2
LITERATURE REVIEW

48
REVIEW OF LITERATURE

Banking is one of the first industries to adopt chatbots in its operations. Chatbots are advanced
computers designed to interact with customers just like humans. Therefore, they can help
banks increase customer satisfaction by answering many questions from banks within
seconds. State Bank of India (SBI) is the largest commercial bank in the country. It uses bank
intelligence to provide good banking services.
SBI Intelligent Assistant (SIA) is an AI-powered intelligent chat assistant that instantly
resolves customer queries and assists them in their daily banking activities just like a human.
Developed by smart banking platform Payjo, the smart chat assistant can solve around 10,000
questions per second, or 864 million questions per day, or almost 25 percent of the questions
Google works on every day.
S. Sarbabidya, T.Saha, (2020) explains that chatbots are a new, intelligent and ready-to-use
technology, showing that they can be useful in providing a variety of services for customers,
such as one-on-one. chat, one hour customer response used by M Support is available 7/365.
According to Adam, M. Wessel, Benlian (2020), a chatbot is a system, often based on
artificial intelligence, designed to communicate with human users via natural language. ,
Nguyen, Tung, (2019) analyzes the experimental use of chatbots for customer support in a
case company to evaluate the impact of chatbots on customer support operations. Another
author,
E. Ojapuska (2018), explains the impact of chatbots on customer interaction and how chatbots
differ from other communication tools used to support the products people use.
Gupta. A, Sharma. D, (2018) describes customer behavior towards chatbots in Indian banking,
including the TAM model. Motivation about play, relationships and relationships, L.N.
Michael, 2018 provides insight into the design and implementation of SMS chatbot-based
virtual assistance for hotel guests.
Also, Petter Bae Brandtzaeg and Asbjorn Folstad, 2017 explain why they use chatbots that
have been shown to help users get timely and helpful help.
From these research data it can be concluded that customers need full support to be satisfied
with the service. As it turns out, this is not only the answer, self-learning to improve itself, this
not only improves the quality of customers, but also reduces people's baggage. Since then, AI-
based customer service has grown in popularity in many areas and can save significant time
and money.
49
Therefore, it is a good idea to increase the use of chatbots. It also helps with consistency.
Cristani said: “The concept of AI banking has been discussed in some general areas,
including the complexity of banking services, for example algorithms, efficient processes,
thinking and consistency.

Nathaniel: After the financial crisis a decade ago, disgruntled customers should feel
discouraged by the big banks against their smaller rivals, the Economic Times reported. It
didn't happen. Big banks are more accessible. Now, another wave of banks has emerged that
say the new banks have learned from their mistakes.
kumba sennaar's 'Artificial intelligence at the forefront' analysis of top 7 banks: While tech
companies like to take a look at the tech industry, artificial intelligence in banking and other
financial aspects has seen the results of interest and adoption - even in stubborn field banking
officers.
"Artificial Intelligence in Indian Banking", Kul Bhushan, July 2018: Artificial intelligence in
banking is more than Chatbots. Therefore, banks especially in India should consider using this
technology to allow more and more innovative transactions using AI for many parts
applications.

'The AI Leader of UK Banking', Tom Graham 2016 'Redefining Banking with AI', Accenture
The Future of Banking; The Role of Information Technology', matej marinc 2015 Published
September 2009: Transforming all business and financial institutions However, advancement
in information technology can attract the banking industry.

50
Journal of banking and finance” published by Marinc in 2010

Parkes, 2015. The determinants and consequences of internet banking

The impact of intelligence on business and financial services. since 1960. In the eighties,
investment in artificial intelligence continues to grow in the form of expert systems.

“Rise of Artificial Intelligence in Banking” published by Babu Rajnish in July 2016

(Vieira & Sehgal, 2018) - Thanks to artificial intelligence (AI) algorithms, business
intelligence will turn into a completely predictive system. AI can change the world or change
the price, financial usage, etc. It could change many economic aspects. Security and Security
Protection This section covers some policy analysis and provides examples of how
intelligence can help the financial industry.
Improve small business credit, learn internet behavior, improve customer service. We will
also see how the integration always works.

(Kaur, 2020) - In this research paper, the authors examine how AI can transform business
operations using the case study of four major companies in India (SBI, HDFC, ICICI, AXIS).
Explore the areas where banks are promoting AI and the key applications of AI in banking in
India. The banking industry has always been progressive and banks are slowly adopting new
technologies such as artificial intelligence, blockchain and cloud computing. But banks have
not yet reached the stage of intellectual change and human exchange is still important. The
Indian banking industry is exploring ways to use artificial intelligence to improve banking
operations and improve customer experience as quickly as possible.

(Marko & Matej, 2018) - According to this article, relationship banking helps strengthen
relationships with customers in the bank and should not be abandoned.
Loans for long-term relationships make it easier for bank customers to meet and pay off their
long-term goals. Banks will be drawn to payment systems due to IT-driven efficiency and
competition from fintech start-ups and IT players. This study discusses distance, machine
intelligence, and cognitive dissonance. The effect of bank stability has been examined.

51
(Ebrahim, Kumaraswamy, & Yomna, 2021) - Examines the use of machine learning (one
of the most cutting-edge technologies) at Barings Bank.
Only a few banks have implemented AI solutions with digitization and chatbots, the most
widely used AI software. Also, the data shows that the Federal Bank of Bahrain is prioritizing
the bank's digital transformation, which means the bank will see more technology
improvements and applications in the future.

(Donepudi, 2017) - Machine learning and AI and its benefits in business operations for many
companies and how these organizations are successfully using AI to improve their companies.
While traditional companies seek AI with products like Chatbots, fintech companies seem to
be embracing AI.
Long ago, financial intelligence played an important role through innovation.

(Dr.C. Vijai, 2019) - Discusses how artificial intelligence (AI) is used in the financial
industry, its benefits in fintech, and the various ways it can help financial institutions. In
fintech, artificial intelligence will play an important role in decision making.
Analysts will be able to make difficult decisions thanks to computers that provide pre- and
post-decision support based on historical data and emerging trends.

(Malali and Dr.S. Gopalakrishnan, 2020) - This journal discusses how artificial intelligence
(AI) will drive large banks and financial institutions to rethink their businesses, create
products and services, and most importantly, recognize relevant value. User experience. 4,444
fintech startups will challenge banks in the age of machines, using technology to supplement
and even replace human work with intelligent algorithms.
To remain competitive, banks and financial institutions must acquire intelligence and integrate
it into their business strategies and operations.

(Romao, 2019) - This report discusses the link between artificial intelligence and robotics.
RPA is the use of software with artificial intelligence (AI) and machine learning to manage
high-volume, repetitive processes that were previously used only by humans. In short,
traditional business process management (BPM) systems have at least one disadvantage: They
cannot identify the best mix of activities, people, and time to get the most out of these
activities while minimizing costs and risks. However, the reality of today's dynamic business
world is undeniable.
52
On the one hand, we need to be more efficient and precise than what is done to allocate
valuable resources to more important areas.

RESEARCH GAP
Though the handful of works on artificial intelligence in banking services and their related
activities regarding the process, performance of technology and prospects are found, most of
the projects or studies have been done during pre-reform period. In the post reform period,
enormous changes have been taken place in the banking sector. Artificial intelligence is still
relatively rare in the banking world.

53
 CHAPTER 3
RESEARCH METHODOLOGY

54
 RESEARCH METHODOLOGY

TITLE OF THE STUDY

A Study on IMPACT OF CHATBOTS AND ARTIFICIAL INTELLIGENCE IN

CUSTOMER SERVICES: A RESEARCH IN BANKING SECTOR

STATEMENT OF THE PROBLEM

The problem with the prevailing and old banking device is to make your mind up based totally on
massive facts, it's far very highly-priced in time period of fee in addition to approximately twenty
to thirty percent made selections is going incorrect due to incomplete and irrelevant information on
the organizational plan. The A.I. Nation of the art system will cope with these problems
intelligently and screen all of the information associated with stakeholders to method the reports.
This A.I. Device will use actual-time information to coordinate and manual the customer to take
immediate choices and govern in keeping with the rules and policies. This machine can even hold
the profitability of the organization with the aid of growing the credit by using carrying out a
couple of customers on the identical time on the proper manner to right now invest the money
inside the banking area.

NEED FOR THE STUDY

Artificial intelligence is very important in present generation on banking service and other.
Now a days the fast technology advancement in banking services is very good by providing
online banking services and mobile banking. Artificial intelligence is much role in providing
banking services to peoples. The technology in banking lot of changes occurs in ATM
machines, transaction through online and technology plays a vital role in banking services.
SCOPE OF THE STUDY
Artificial intelligence in banking services creates a stronger to work on, by making banking
processes problem-free. Artificial intelligence cloud computing, blockchain and digital
dashboards are some of the latest technology that are helping banks to provide better services
and automate their systems. AI is working on providing personalized support, high-quality
customer experience, speed and efficiency and cost saving.

55
 RESEARCH METHODOLOGY

Research design is the basic framework for the study. Research methodology is used to
examination of the issues reliably. It includes collection of proper information utilization of
factual approaches, clarification and representation decisions aboutresearch information.

Descriptive research

Descriptive research is used to describe the applications in the accurate and correct way.
Descriptive is all that describing the individuals who take part with the study.

Research design

The study shall consist of the collecting the data mustered from the sample respondents and
the data would be used for analysis and thence reporting the same in various parts. Thus,
method used in this study is a sampling.

Sources of Data

The data is collected from both the primary and secondary sources.

Primary data - Primary data is the data collected by investigator himself for the first time
of a specified study. The primary data can be collected by observations, survey method.
The data is proposed to be collected through structured questionnaires and also through
personal interactions and observations.

Secondary data – Secondary data refers to the data which is already exist or collected
by someone before it include published records, journals, magazines, articles, books,
CDs, websites and newspapers, so on.

56
SAMPLING Sample Size : 100

Sampling unit : who are customer to banking services in

Lucknow city.

Sampling technique: Simple Random technique.

Plan of Analysis: The data captured would be presented in tables and charts depending on
the parameters. Statistical tools such as percentages, mean score and standard deviation would
be employed to analyse the data and the report would be classified into various sections as
required.

LIMITATIONS OF THE STUDY

 The study only conducts in Lucknow city.

 Time period of research project is very short.
 The sample size taken is small.
 The result of the project is based on questionnaire.

57
 DATA ANALYSIS AND INTERPRETATION

In this chapter the researcher has made an attempt to find the profile of customers of banks for
the Study of IMPACT OF CHATBOTS AND ARTIFICIAL INTELLIGENCE IN
CUSTOMER SERVICES: A RESEARCH IN BANKING SECTOR
An attempt has been made to analyse the sample of banks customers such as gender, age,
educational qualification, annual income, type of banking services, performance of technical
services.
Gender
Table 3.1
Gender Number Percentage
Male 80 80
Female 20 20

Total 100 100

Analysis: The above table is showing the gender summary of the respondents, the table
shows that there were 80% respondents were male and remaining 20% were female
respondents.

Loan Enquiry
Money Transfer
17%
24%

General Enquiry
59%

Loan Enquiry General Enquiry Money Transfer

Graph 3.1.1
Interpretation:
The above chart interpreted that greatest of the respondents were male and not so many were
females. This implied that there were more males are cooperated with the investigators
through the study and more male are using services.

58
 Age of Respondents:
Age of respondents is very important in understanding the views of particular problem. We
can get the more matured responses in the field of agriculture.
Table 3.2
Age Frequency Percentage
20-30 64 64
30-40 26 26

40-50 8 8
50 and above 2 2

Total 100 100

Analysis: From the above table shows the total respondents about 64% of the people are of
the age group between 20 to 30 years of age. 26% of the people are of the age group between
30 to 40 years of age. About 8% of the people are of the age group between 40 to 50 years of
age and the remaining 2% are of the age group above 50 years.
Graph 3.2.1

Deposit RelatedLoan Enquiry

12% 15%

Money Transfer
21%

General Enquiry
52%

Loan Enquiry General Enquiry Money Transfer Deposit Related

Interpretation
According to the above chart it is clear that maximum of the respondents are young aged
people who were having less than 40 years old. It is clear that the people who arehaving the
young age and the capacity of involving banking services activity is more and they are
intentionally involve banking services for more requirements.

59
 Educational Qualification
Table 3.3

Qualification Number Percentage

SSLC 8 8
PUC/ITI/Diploma 16 16
Graduate 44 44
Post graduates 32 32
Total 100 100

Analysis: The above table shows that the educational qualification of the respondents. Out
of 50 respondents 16 were the post graduates and 22 respondents are the graduates and the 8
respondents are intermediate and only 4 respondents are SSLC or below.
Graph 3.3.1

Deposit RelatedLoan Enquiry

12% 15%

Money Transfer
21%

General Enquiry
52%

Loan Enquiry General Enquiry Money Transfer Deposit Related

According to the above chart it can be stated that educational qualification of the respondents.
According to the study the customers who are involved in banking services activities are more
in case of graduates and post graduates because some of the education is required for those
services. It can be understand that people are in city areas are have more education.

60
 Income
Table 3.4
Income Number Percentage
Below 1 lakh 20 20
1 lakh to 5 lakh 40 40

5 lakh to 10 lakh 8 8
10 lakh and above 0 0
Not earning presently 32 32
Total 100 100

Analysis:
Above table is showing the income level of the respondents. Out of 50 respondentsno one is
having the income more than Rs 10 lakh. 40% of people are having the income of 1 lakh to 5
lakh and 20% of the people are having the income of below 1 lakh and most of the
respondents are not earning the income presently because 32% ofrespondents are unemployed
or students presently.

Others Loan Enquiry

8% 14%
Deposit Related
11%

Money Transfer
19%

General Enquiry
48%

Loan Enquiry General Enquiry Money Transfer Deposit Related Others

Graph 3.4.1
Interpretation:
From the chart we found that the income of customers of bank, most of the customer areearning
their income 1 lakh to 5 lakh of 40% is shown. No one can earning the above 10 lakh income
as my survey.

61
 Most liked banking services
Table 3.5.1

Services Number Percentage

ATM services 24 24

Mobile banking 60 60

Online banking 16 16

Total 100 100

Analysis
From the above table 60% Of the customers using the mobile banking services and 24% of
customers like the ATM services facility, 16% of respondents are liked the online banking
services through electronic devices. These analysis shows that themost of the customers
are requiring the services with new technology.
Graph 3.5.1

Loan Enquiry
Money Transfer
17%
24%

General Enquiry
59%

Loan Enquiry General Enquiry Money Transfer

Banking services when compared to other services provided by bank, and ATM services are
using by the customer but lesser than the mobile banking. Now days all people are using
online and mobile banking that save their time and money.

62
 Technology advancement in banks

Table 3.6.1

Category of banks Number of respondents Percentage

Public sector banks 30 30

Private sector banks 70 70

Total 100 100

Analysis : From the table the most of the respondents are giving their opinion on the banks
which type of the banks are technologically advancement in the services provide. Private
sector banks are giving most technological advancements in services provide comparison with
public sector banks.
Graph 3.6.1

Loan Enquiry
Money Transfer
17%
24%

General Enquiry
59%

Loan Enquiry General Enquiry Money Transfer

Interpretation

From the above chart show which category of banks are most technologically advancement,
inthat more private sector banks are adopting the advanced technology with 70% and 30% of
public sector banks are involve in the technology for banking.

63
 Attribute of banks do you value most
Table 3.8.1

Attribute Number Percentage

quality of service 22 22

Technology used 46 46
Trust 12 12
location 8 8
Type of bank 12 12
Total 100 100

Analysis : The table indicate the most of the respondents are like the technology used in the
banking services with 46 respondents are given, rest of the people like the quality of services,
type of bank, and nearest location of the bank. In these days all areusing the technological
services through electronic devices.
Graph 3.8.1

Others Loan Enquiry

8% 14%
Deposit Related
11%

Money Transfer
19%

General Enquiry
48%

Loan Enquiry General Enquiry Money Transfer Deposit Related Others

remaining respondents are like the type of bank with 12%, trust in bank with 12%, quality of
service with 22%, bank located in their nearest areas and finally technologyof banks used in
services are most important.

64
 Robotic banking in future
Table 3.9.1

Responses Number Percentage

Yes 74 74
No 23 23
Total 100 100

Analysis
From the above table demonstrate that the total number is respondents is 50 out of that the
positive response about robotic banking in future is given by 37 respondents and negative
response given by 13 respondents which is equivalent to 73% and 23% respectively.

Graph 3.9.1

Others Loan Enquiry

8%
Deposit Related 14%
11%

Money Transfer
19%

General Enquiry
48%

Loan Enquiry General Enquiry Money Transfer Deposit Related Others

Interpretation
The above chart interpret that the number of respondents are requiring robotic bankingin future
for better quality of services, in this some of the members are not requiring advanced
technology in baking services.

65
 How do you rate
Table 3.10.1: showing that how customers rated for banking services with technology

Particulars Excellent Good Neutral Poor Very poor

ATM services 27 23 0 0 0

SMS alert 21 15 14 0 0

Statement 15 25 10 0 0

Internet banking 35 12 3 0 0

Telephone banking 5 8 25 12 0
Mobile banking 41 9 0 0 0

Analysis :
From the above table it can be analysed that 54% respondents feel excellent with the ATM
services , 46% of the respondents are feel like good, and no one can feel like neutral, poor,
very poor with 00% of respondents.
From the above table it can be analysed that 42% of the respondents feel excellent with SMS
alert system, 30% of the respondents feel good, 28% feel like neutral, 00% of respondents feel
with poor and very poor.
From the above table it can be analysed that 30% of respondents feel excellent with statement
request through online, 50% feel good, 10% feel neutral, 00% of respondents are feel poor and
very poor with statement request.
From the above table it can be analysed that 70% of respondents feel excellent with internet
banking through online, 24% of respondents feel good with that, 6% of respondents feel
neutral, 00% of response come like poor and very poor.
From the above show the most of the respondents are feel bad with telephone banking
services.
From the above table it can be analysed that 82% of respondents feel excellent with mobile
banking, 18% of response is good, 00% of remaining aspects.

66
Graph 3.10.1

Rate for banking

4

0
ATM SMS Statement Internet Telepho Mobile
ne
Excellent Good Nuetral Poor

Interpretation

From the above graph it ca bee interpret that majority of the respondents are feeling
excellent with ATM services, internet banking services, mobile banking services through
online. The telephone banking is not satisfy the customer services comparisonwith other
banking services. The overall services by bank is based on technology advancement.

67
Impact of Chat-bots in Banking Experience

When the respondents were asked if they used a mobile banking app or website for their
banking queries and transactions?

Never
5%

Occasionally
35%
Often
60%

Majority of the respondents that is 48 out of 80 use mobile banking app or website for their
banking queries and transactions and hence the scope of chatbots in assisting in the banking
experience is wide.

68
 When asked do you find phone calls with a customer service personnel ending up as
a frustrating experience?

Never
13% Always
17%

Occasionally
70%

56 out of 80 respondents find phone calls with a customer service personnel endingup as a
frustrating experience occasionally while 14 out of 80 respondents find phone calls with a
customer service personnel ending up as a frustrating experience always. These high numbers
are indicative of the need for a better banking experience.

69
 When the respondents were asked are you aware of Chat-Bots? for example EVA of
HDFC Bank

Only Heard
3%

No
15%

Yes
82%

66 out of 80 respondents were aware about chat-bots while 12 were not and 2 respondents had
only heard about chat-bots. This proves that majority of therespondents were aware about
chat- bots and hence the concept of chat-bots is quite popular.

70
 Respondents were asked if they had ever tried using Chatbots on a banking
website? such as HDFC bank's Eva, ICICI banks IPAL?

No
30%

Yes
70%

56 out of 80 respondents had used chat-bots while 24 had not since in the future questions
were based on the experience the respondents had with the chat-bots the sample size reduced
to 56.

71
 When asked about their experience in engaging with Chat-bots during a banking
query?

Non-Satisfactory
32%
Satisfactory
68%

Majority of the respondents had a satisfactory experience in engaging with Chat-bots

during a banking query

72
 When asked if you have encountered any inconvenience that arose during
communication with a Chat-Bot?

Always
4%

Never
30%

Occasionally
66%

37 out of 56 respondents stated occasionally inconvenience during communicationwith chat-

bots while 17 out of 56 never experienced any inconvenience during communication with
chat- bots. This indicates that chat-bots have a scope for improvement.

73
 When asked if you have security concerns regarding the use of Chat-Bots with
reference to sharing your private information particularly access to your credit
card details?

No
36%

Yes
64%

Majority of the respondents have Security Concerns Regarding the use of Chat-Bots with
Reference to Sharing their Private Information Particularly Access to their Credit Card Details
indicating the lack of trust in chat-bots with respect to privacy.

74
 When the respondents were asked are you comfortable using Chat-Bots for some
basic tasks such as balance checking and making payments?

No
29%

Yes
71%

Majority of the respondents are comfortable with using chat-bots for some basic tasks such
as balance checking and making payments.

75
 When asked what kind of queries do you use Chat-Bots for? (can be more than one)

50

45

40

35

30

25

20

15

10

0
Loan Enquiry General Money Deposit Others
Enquiry Transfer Related

The survey indicates that majority of the respondents use the services of a chat-bot for general
enquiries followed by enquiries on money transfer while only few respondents utilized used
chat bots for loan related enquiries.

76
 When the respondents were asked how they would describe customer service Chat-
bots of solving the purpose for their creation to deliver customer satisfaction round
the clock (24*7)

Effective
23%

Not Effective
7%
Some What
Effective
70%

Majority of the respondents stated chat-bots have some what been effective in sucessfuly
serving the purpose for their creation to deliver customer satisfaction round the clock.

77
 Lastly, when the respondents were asked do you feel Chat-Bots can replace
customer service executives in the near future?

Yes
19%

Maybe
43%

No
38%

Majority of the respondents feel that there is a possibility that chat-bots couldreplace
customer service executives

78
CHAPTER – 4

FINDINGS

79
 FINDINGS

 The survey revealed that the majority of respondents are aware of information on
banking sector intelligence. Also, most of the respondents use modern technology in
their banking services.
 The study also revealed that the majority of respondents were satisfied with the
overall quality of banking services, and the majority of respondents were very
satisfied with the bank's financial success.
 No information as state-of-the-art banking services require some Internet
knowledge.
 Mobile banking offers the opportunity to establish personal connections with current
and future customers at low cost.
 Since electronic banking services are provided over the internet, they cannot be
provided without network services.
 We can also see that representation of attributes is seen as very important by the
majority of respondents.
 Mobile banking is cost-effective. Many banks offer these services at a lower cost
than retail banking services. Flashing your phone reduces the risk of fraud.
 You will receive a message every time there is activity on your account. This
includes deposits, withdrawals, withdrawals, etc. are included. You will be notified
when money is withdrawn or deposited.
 Banks can communicate with their customers online, telephone
 Banking, mobile banking etc. they can communicate. Banks can promote and sell
products and services such as credit cards and loans.
 Brands target specific customers.
 People can pay electricity bills, buy bills, recharge, buy movie tickets, pay health
bills with mobile payment.
According to current RBI guidelines, service is limited to bank account holders only.

80
 CHAPTER- 5
SUGGESTIONS AND
CONCLUSION

81
SUGGESTIONS

 Need to develop sophisticated banking services with latest technology namely robotic

banking.

 Give the knowledge about technological education to customers regarding online

transactions, e-payments, electronic channels.

 There is need for good network facility for effective services.

 Financial Institutions such as banks see m-commerce as offering new channels of

services to customers as well as offering them new and innovativeservices.

 When a banks offers e-payments services, it may be ensured that customers having

electronic devices for utilisation of that services.

 Conduct periodic risk management analysis, security vulnerability assessment of the

application and network etc at least once in a year.

 Maintain proper and full documentation of security practices, guidelines, methods and

procedures use in electronic or online banking and payment system and keep them up

to date based on periodic risk management.

82
 CONCLUSION

With the rapid development of communication and transportation, integration of people and
services seems to be just around the corner. If this is true for many services, why are
commercial banking services lagging behind? Networks enable banks to better connect with
customers and vice versa. Artificial intelligence now plays an important role in banking
services with its advanced technology.
More and more banks are using chatbot services.
Many banks have integrated chatbots into their mobile apps and websites. As more progress is
made in the intelligence space, the quality of chatbots will continue to evolve and improve,
giving banks an easy way to stay in touch with their customers. It can also increase the human
touch and reduce exports of consumer goods in the future. According to Juniper Research
estimates, chatbot interactions will save banks 862 million hours by 2023, equivalent to $7.3
billion in global cost savings.
Our research shows that banking customers are not only aware of chatbots, but also find them
useful and will replace customer service representatives in the future.
AI online banking is popular with electronic consumers. Evolution shows that the business is
moving to new energy sources.
Online banking gives customers more freedom to manage their money without having to go to
the branch. Mobile banking should become the focal point of mobile banking; mobile banking
should become the big killer in mobile usage.
In conclusion, we can say that the expertise in banking services is recognized by customers
for its quality services and new technologies.

83
 BIBILIOGRAPHY

• D Muraleedharan “Modern Banking and Information Technology” by Universal Law

Publishing co. ltd
• J Chandradass “Banking and Financial System” by Himalaya Publishing House
• H.R. Machiraju “Modern Commercial Banking” by New Age InternationalPublishers
• Peter S. Rose “Bank Management and Financial Services” by Himalaya Publishing
House
• Dr K Nirmala Prasad “Banking and Financial System” by Himalaya PublishingHouse
• Hrishikesh Bhattacharya “Banking Strategy and Credit Appraisal” by Himalaya
Publishing House

WEBSITES

 https://www.indianbank.net.in

 https://www.researchgate.net

 https://www.business-satandard.com

 https://www.nelito.com/blog/ai-and-its-impact-on-the-finance-industry.html

 https://internationalbanker.com/banking/how-ai-is-disrupting-the-banking-industry

 https://www.globalbankingandfinance.com/banks-are-splashing-artificial-intelligence

84
ANNEXURE

85
 QUESTIONNAIRE

NAME: ……………………....…......................…….

AGE: ………...…… SEX: ..............................

EDUCATIONAL QUALIFICATION: ……………….............……..

Q1. In which income criteria do you fall?

a) Below 1 lakh

b) 1 lakh to 5 lakh

c) 5 lakh to 10 lakh

d) 10 lakh and above

e) Not earning presently

Q.2 What are your most liked banking services?

a) ATM services

b) Mobile banking

c) Online banking

Q.3 In which sector bank technology advancement is better?

a) Public sector banks

b) Private sector banks

Q.4 Which attributes of bank do you value the most?

a) Quality of service

b) Technology used

c) Trust

d) Location

e) Type of bank

86
Q.5 Do you think Robotic Banking is future?

a) Yes

b) No

Q.6 Do you use a mobile banking app or website for their banking queries and

transactions?

a) Occasionally

b) Often

c) Never

Q7. Do you find phone calls with a customer service personnel ending up as a

frustrating experience?

a) Occasionally

b) Always

c) Never

Q.8 Are you aware of Chat-Bots? For example EVA of HDFC Bank?
a) Yes

b) No

c) Only Heard

Q.9 If y o u had ever tried using Chatbots on a banking website? Such as HDFC
bank's Eva, ICICI banks IPAL??
a) Yes

b) No

Q.10 What is your experience in engaging with Chat-bots during a banking query?
a) Satisfactory

b) Non-Satisfactory

87
Q.11 If you have encountered any inconvenience that arose during communication
with a Chat-Bot?
a) Occasionally

b) Always

c) Never

Q.12 Whether you have security concerns regarding the use of Chat-Bots with
reference to sharing your private information particularly access to your credit
card details?
a) Yes

b) No

Q.13 Are you comfortable using Chat-Bots for some basic tasks such as balance
checking and making payments?
a) Yes

b) No

Q.14 What kind of queries do you use Chat-Bots for? (can be more than one)
a) Loan Enquiry

b) General Enquiry

c) Money Transfer

d) Deposit Related

e) Others

Q.15 How you would describe customer service Chat-bots of solving the purpose for
their creation to deliver customersatisfaction round the clock (24*7)
a) Effective

b) Somewhat Effective

c) Not Effective

88
 Q.16 Do you feel Chat-Bots can replace customer service executives in the near
future?
a) Yes

b) No

c) Maybe

“The information collected is only for the academic purpose and will be kept

confidential.”

THANK YOU

89