Compliance is changing. The Regulations are becoming more clearly focused and the penalties continue to become more severe. The new Consumer Duty creates new challenges for organisations that can be met with AI.
Now a significant part of the legal duties focus on the so-called soft and human interactions. This is already recognised by regulatory bodies like FCA, who have introduced Treating Customers Fairly guidelines, and continue to bring more focus on the consumer protection with the new Consumer Duty Principle.
I’ve been frequently asked recently: What is the role of AI in making sure those principles are followed for the best possible outcomes?
Here are 7 ways that AI-driven conversational analytics can be used to help you prepare and navigate through this new change in regulation.
Conversation Analysis in this context is using AI to understand what is said and what is not said on a phone call, in a live chat with an agent, or through any other channel. With the ever growing processing power available to AI applications, conversation analysis can understand the context of a conversation, identify vulnerabilities, confusion as well as other behavioural patterns, and more importantly do it at scale.
How AI Can Help You to Prepare?
What can you do today to guard your operation and be 100% ready for the Consumer Duty?
Clarity of Communication
Treating Customers Fairly already relies on clarity as a very important communication element in your customer interactions. The Consumer Duty requires that firms must give customers information that they can understand. This goes beyond a requirement to read scripts and provide information. And how do you measure this in an objective way? This is where an advanced AI system can help. An advanced conversational analytics platform like Sentient Machines can identify: How confused is your customer? Are they seeking for clarification because they are confused, or simply because they are inquiring about further information? Has the common ground been established between the two speakers?
Pre-emption of Complaints
It is not surprising that FCA have identified reduction of complaints going to the Financial Ombudsman Service as one way to measure the outcomes of the Consumer Duty Principle. Especially in relation to fees or charges or inappropriate product or service sales. In an ideal world, there are no complaints, and with the right AI approach, you can achieve exactly this - by preempting them. For the few that still come through, you could be alerted immediately and react promptly to potentially recover the customer relationship as you will have time to dedicate to it.
Focus on Customer Needs
Understand your customer needs in real time and measure the impact of changes you introduce immediately. In his recent speech, the CEO of FCA, Nikhil Rathi, mentioned an AI solution that was implemented by a major bank that could predict with 99% accuracy a customer’s bank balance in a year’s time. When customers were presented with this innovation, they did not want the product integrated into their banking app. So how do you ensure that you truly listen to your customers and their needs? Is your AI there for the right purpose? In the UK alone, there’s 2 million hours of customer interactions over the phone every single day. Listening to your customers, understanding what they like and dislike is critical in meeting the requirement to do with meeting the customer needs. An advanced conversational analytics platform can measure and quantify your customer preferences, and monitor emerging trends so that you can react while it still matters.
Track Customer Objectives
While AI is still not at the point to perform extremely complex human tasks, such as a subtle judgement of whether customer financial objectives have been met or not under complicated circumstances, and where the concussion needs to be reached from combining multiple sources of information, it is certainly able to assist humans, or at least provide guidance in that direction. Similar to understanding customer needs, AI can easily scan whether or not you’ve discussed customer financial objectives, and raise red flags otherwise. It could also provide cues as to whether or not those objectives are met and raise red flags for outliers that humans would then have to verify.
Identification of Vulnerable Customers
The definition of vulnerability is the one that is constantly evolving and changing and the ability to recognise early signs can bring many advantages to firms. With AI, you can identify those early signs and reach out in a more personalised ways to really help nurture your customers. How is their health? How is their family situation? How is their stress level?
Treatment of Vulnerable Customers
Depending on your vulnerable customer situation, you might want to set up different frameworks to help support them. AI can not only help you identify vulnerabilities, but also, once the vulnerability is detected, it can scan and help advisors understand if they have followed required procedures, or if they could benefit from further training.
Monitor Your Agent Well-being
What does an advisor's wellbeing have to do with the actual customer? Everything. They are the face of your company. Imagine speaking all day with customers who are in a challenging life situation. Perhaps they’ve lost their job, or they’ve had sad news with regards to their health. Or their family. At the core of fair outcomes for your customer, is the stability of your own team who’s responsible for handling those conversations. Advanced conversational analytics platform from Sentient Machines can help with identifying those critical moments that could make all the difference.
Conclusion
Humans and AI working together are stronger than working independently. It is humanly impossible to review and listen to all customer interactions, yet alone accurately identify red flags at scale. AI on the other hand can scan and analyse an enormous number of conversations in no time, letting you spend your time only on things that create maximum impact.
Advanced conversational analytics can work for you in the background, sending you alerts for emergencies, but also to turbo-charge your training and bring the competency of your team to the required level quickly.
Consumer Duty might be the perfect bridge between enabling companies to fully embrace regulations while at the same time building healthy relationships with their customers. And AI, and conversational analytics in particular, has a lot to offer to make this bridge a massive opportunity to fully embrace the current technical revolution taking customer service to the next level.