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Are Humanoid Robots & AI the Future of Banking Industry?

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Move aside traditional bankers, Humanoid Robots are here!

As customers embrace new technology, banks are also trying to meet client expectations by digitizing their operations with the help of latest technology including artificial intelligence (AI) and virtual assistance.  

So, for the first time in the United States, HSBC Holdings (HSBC - Free Report) has unveiled seven humanoid robots — Pepper — at its flagship Fifth Avenue branch in New York. Developed by SoftBank Robotics Group, the humanoid robots are expected to reduce wait time at branches, assist and encourage customers to use available technical tools and platforms, and make clients aware of HSBC products and services. All these efforts are expected to draw more business.

If the robots are able to enhance customer experience, HSBC will roll these out to its 228 U.S. branches. Further, the bank intends to gradually increase Pepper’s capabilities and allow customers to complete product applications on its tablets. Notably, the company has spent nearly $131 million on robots and other technology upgrades.

Pablo Sanchez, regional head of retail banking and wealth management segment for HSBC in the U.S. and Canada, said, “We’re focused on developing the ‘branch of the future,’ and our use of Pepper will streamline branch operations and delight our customers, allowing bank staff to have deeper, more high-value customer engagements.”

HSBC is not the only bank using AI to interact with customers. In 2016, Bank of America (BAC - Free Report) introduced Erica, the AI-enabled financial assistant. This along with Zelle (which allows consumers make payments to one another using their smartphones) is helping this Zacks Rank #3 (Hold) company to win new customers.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

JPMorgan (JPM - Free Report) , U.S. Bancorp (USB - Free Report) and Wells Fargo (WFC - Free Report) are also using virtual assistance to interact with clients. Further, banks are trying to utilize already familiar AIs including Amazon's (AMZN - Free Report) Alexa, Apple's (AAPL - Free Report) Siri and Google's (GOOG - Free Report) Assistant to assist customers to transfer money, pay bills and check balances.

While digitizing of banking operations is nothing new, use of humanoid robots in branches is expected further enhance customer experiences. Also, these will also give the branches, which are gradually experiencing lower footfall, a new lease of life.

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