Barclays is shaping up as an innovator for AI in banking.

Barclays Bank, UK, (LON: BARC) which is ranked 20^th on the S&P Global’s list of the top 100 banks, has taken many initiatives for the use of Artificial Intelligence (AI) in its operations. Its model is to outsource the deployment to technological partners, rather than develop the software in-house. (aitrends)

That seems to be the preferred model in the financial services sector. According to emerj, 68% of the AI products it researched as part of its AI Opportunity Landscape research in financial services were bought from vendors.

Barclays’ foray into AI spans risk modeling (for loan risk), voice recognition (authentication), and business process automation (debit cards and customer feedback).

Risk modeling:  Simudyne

Barclays tied up with AI startup Simudyne in July 2019. Simudyne allows banking customers to simulate various banking situations and operations using transactional data.

The Simudyne software enables a bank to obtain a holistic view of all the risks and implications that could arise for a loan or investment.

According to Barclays, the software enabled the bank to better structure its customer offerings, particularly new financial products.

Simudyne’s software runs predictive analytics, and using historical data, the bank can examine the likelihood of a customer defaulting on a loan.

Barclays executives can use Simudyne to analyze mortgages, conduct stress tests, and assess contagion risk.

Voice recognition: Nuance

Barclays used voice recognition technology from Nuance Communications to authenticate and verify customers’ identities. This is a branch of AI called natural language processing (NLP). Nuance refers to NLP as “voice biometrics.”

The deployment of the Nuance system allowed Barclays to substantially improve its interaction service for customers.

The bank gained a 90% reduction in complaints about security questions that it used to verify customers’ identities.

Further, the average customers’ call times dropped by 15%.

Business Process Automation: IBM

IBM supplied its “Business Process Manager” and “Blueworks Live” AI applications to Barclays Bank. The latter is a cloud-based storage system for documenting customer journeys such as data.

Barclays used these systems to determine the level of customer satisfaction during their journeys through the bank’s processes. The bank also was able to better process incidences of lost or stolen credit cards and alleged identity theft. The system also flagged attempted fraud on customers’ accounts and enabled the bank to send out warning SMS messages to them.

Barclays apparently got substantial dividends from the software. It could replace missing or compromised cards 67% faster, and roll out new business processes 88% faster.

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