AI’s impact on Australian financial sector grows

By Leon Gettler, Talking Business

GENERATIVE artificial intelligence is starting to have a big impact on the financial services industry and it’s likely to become even more prevalent.

Nick Smith, vice president and general manager for the Asia Pacific region at Smart Communications, said AI was ‘almost made for’ banks, insurance companies, wealth management firms and superannuation providers.

First, it could save them on costs by automating processes. Then it would also change the way their employees talked to customers.

“All of them share the challenge of engaging with their customers, educating their customers and using AI in a way that creates value,” Mr Smith told Talking Business.

“If you look at superannuation, engagement with the younger customer is difficult so I can see how they can simplify their language and engage with their customers over the life-cycle with AI, because they can do more frequent communications on broader topics much faster. 

“With the banking sector, I can see (AI address) a lot of the processes that are frustratingly managed through a call centre with customers. And that will actually free up the staff to have those valuable conversations with customers.

“In insurance, you can see how AI can automate a claims process and make it faster, better, quicker.

“So there are lots of opportunities and we’ll see how it goes.”

AI will not cost jobs

Mr Smith said AI would not cost jobs in the financial sector as a lot of the processes need humans to vet them.

“Fundamentally in the financial sector broadly, there is this concept of trust.,” he said.

“We as humans are very quick to spot insincerity and lack of authenticity.

“A level of automated processes will frustrate us. We want to speak to a human so I think, as AI evolves … when we as humans want to have a conversation about something more challenging.

“I think AI will free up staff to have those more valuable conversations and provide a level of differentiated service that we seem to have lost over the last few years with automated calling into the call centre where you have to wait for 15 minutes and go through seven buttons before you get to somebody,” Mr Smith said.

AI could help improve service quality

Mr Smith said AI could also provide a better quality of service.

He said an AI tool needed humans to manage it and create a more personalised communication system.

“But we’ve also seen, in the early days of AI, it’s not very good in dealing with bias and complexity and there are risks in it as well.

“Certainly, we can see the generation of prose being very valuable but we also feel you have to have humans involved to validate and check because ultimately, in highly regulated industries, you don’t want to upset the regulators or your customers because both would have expensive consequences.”

Mr Smith said most banks, insurers and superannuation specialists have people on board managing AI but there were risks.

“The fundamental risk with AI is we might have organisations pivot too quickly and rely too heavily on the tools and that runs the risk around more complex products and calculations producing the wrong information,” Mr Smith said.

“So again, that human intervention before the information goes out is critical.”


Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at


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