Many technology pundits have hailed 2016 as “The Year of Artificial Intelligence.” However, in the interest of full disclosure, about a year ago many technology pundits – perhaps the same technology pundits – similarly hailed the coming of 2015.

If the pundits are finally right, it will have been a long time coming. The term artificial intelligence, or AI, was first coined by computing pioneer John McCarthy in 1955. McCarthy simply defined AI as “the science and engineering of making intelligent machines.”

Even if this doesn't prove to be a watershed year of AI as a broad discipline, it does seem to be making some significant inroads into the financial services industry. And while the technology is still relatively rare (translation: expensive) in financial services, like all other worthwhile technologies, AI is bound to become more pervasive (and less expensive). That means, if nothing else, AI is worth keeping an eye on.

What Can AI Do for Me?

Maybe it seems like there isn't much of a place for AI in an average credit union. If that's what you think, think again. AI is really all about creating technology that is capable of making intelligent decisions. And what is a credit union if not the sum total of all the decisions made by its employees and executives? Plainly stated, AI can help a credit union make better decisions.

Consider your CRM system (or MRM system, if you insist), for example. It probably includes basic tools to help your employees suggest likely “next” products to your members. This is predictive analytics at its simplest.

However, if you apply more powerful technology, and give that technology more data on which to chew, the results of your predictive analytics will become much more accurate. With an AI-enhanced CRM system, your member service representatives could find themselves offering each member precisely the financial products he or she needs, precisely when they're needed, all to the benefit of your credit union's bottom line.

What about the Mobile Crowd?

AI can also be used to enhance your members' mobile experience. For example, a company called Kasisto makes AI software that potentially allows your members to have a natural-language “conversation” with their records at your credit union.

For example, a member might ask, “How much did I pay on my cable bill last month?” The Kasisto software would instantly translate that question to text, figure out what the member is really asking for, find the answer, and then speak the answer back to the member. Think of it like Apple's Siri, except exclusively for financial service environments.

Superhuman Analysis

AI systems are also being developed that can uncover trends and information that are beyond the capabilities of mere human beings, at least when those human beings are constrained to any reasonable timeframe.

For example, another company called Kensho is developing a natural-language analysis tool for big banks and high-end traders. As reported in The Economist a few months ago, “Kensho's system is designed to interpret natural-language search queries such as, 'What happens to car firms' share prices if oil drops by $5 a barrel?' It will then scour financial reports, company filings, historical market data and the like, and return replies, also in natural language, in seconds.”

Will your credit union invest any of its IT budget in AI this year? Probably not. Should you keep AI on your radar so you're aware of any activity in the big-bank space? Probably so.

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