AI delivering ‘new economics’ for banks, says UBank CEO

Chief executive of NAB subsidiary says she is interested in the idea of a ‘fully fledged cognitive bank’

UBank CEO Lee Hatton in conversation with 7.30 host Leigh Sales at the IBM Think Summit.

UBank CEO Lee Hatton in conversation with 7.30 host Leigh Sales at the IBM Think Summit.

UBank’s embrace of artificial intelligence has helped it grow its customer base while retaining a compact staff headcount -- and it’s also freeing up time for its employees as they attempt to understand the future of banking, according to chief executive Lee Hatton.

AI technologies are helping deliver “new economics of banking,” Hatton yesterday told the IBM Think Summit in Sydney. The online-only bank has a customer base of 500,000 people but only around 220 people in its Sydney HQ, the CEO said. From an economic perspective, the use of AI “gives us scale,” she told the conference. “We can serve more customers in this way.”

UBank, an NAB subsidiary, launched just a bit over a decade ago. Its genesis, Hatton, told conference, was NAB asking: “What would it really look like if we challenged ourselves and disrupted ourselves?”

The opportunity for UBank 10 years ago was to “completely change the way banking was seen by customers,” Hatton said. UBank can rely on the NAB banking licence but has the freedom to “experiment, try new things, and really get into the future of banking.”

One of the things UBank found is that its customers are “happy for their bank to be anonymous,” Hatton said. “They're happy so long as it works.”

That has meant increased self-service channels through the rollout of cognitive technologies that can handle customer enquiries with limited or no human intervention.

The most recent example of this was the February launch of a “digital human” dubbed Mia (for “My Interactive Agent”). According to the bank, it’s the world’s first digital human designed to provide assistance during home loan applications. The Mia avatar uses technology from New Zealand’s FaceMe, with IBM Watson helping parse and answer customer queries.

“Mia is a real part of the UBank team,” the CEO said. One of the key pain points for Australians seeking a home loan is the process of filling out an application, she said. Mia builds on the bank’s extensive experience of experimenting with Watson-based digital assistants to make it less stressful.

In 2017, UBank launched RoboChat: A chatbot leveraging Watson’s Conversation API to answer customer enquiries. Last year the bank revealed details of RoboBrain. Like RoboChat, it utilises Watson. However, RoboBrain is an internal chatbot designed to assist the bank’s (human) customer service team deal with enquiries.

The naming of those two services was deliberate, the CEO, with the bank not seeking to conceal its embrace of AI. Hatton said that she was interested in the concept of a “fully fledged cognitive bank”. “People shouldn’t be intimidated by the future with AI,” she told the conference. “We really want to make sure we’re starting to use these tools now.”

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