How Gen AI means better customer experiences – see one bank's approach

Gaining a competitive advantage from generative AI (Gen AI) is about implementing technology at the right time. Go too early and you could implement a service that creates more challenges than solutions; go too late and your business could be left behind.

Wendy Redshaw, chief digital information officer at NatWest Retail Bank, recognizes the scale of this challenge better than most. In her role leading digital operations for the finance giant, Redshaw manages 4,500 people across four locations globally and oversees the delivery of retail banking technology for Royal Bank of Scotland, NatWest, and Ulster Bank North.

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The team is focused on digitalizing services to make life easier for the group’s customers. Their work is supported by a planned investment of £3.5bn from 2023 to 2025, with more than 70% of spending targeted at data and technology.

Artificial intelligence, from machine learning to large language models (LLMs), plays a key role in this investment strategy.

Redshaw recognizes there’s been a lot of hype about AI, and with good reason — companies and their customers can see the potential benefits.

“When Gen AI came out, everybody got excited about it,” she said. “It was being discussed in our personal lives. It was a very federated piece of technology.”

Yet hype sometimes needs to be tempered, particularly if you’re applying technology in a tightly governed industry like financial services, which uses huge amounts of personal data.

“When you’re in a regulated environment, and you have to keep your customers safe, then obviously just going out and using Gen AI isn’t safe,” she said.

Striking the right balance

Redshaw’s proactive approach to Gen AI allowed the digital team to innovate cautiously.

“We let our colleagues explore this technology within a safe space,” she said. “That initial exploration suggested some areas we might look into. We collected about 100 use cases. Personalization was an obvious place to focus for our customers.”

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Fortunately, NatWest had solid foundations to build this personalized approach because the bank introduced Cora, its first-generation chatbot, in 2017.

Cora could answer basic questions, but Redshaw — who joined the bank in 2018 — wanted the technology to do more.

The answer was Cora+, NatWest’s next-generation assistant powered by Gen AI. “That felt like the most impactful use case,” she said. It was a case of, ‘Okay, fine, let’s see what we need to do to explore this technology safely in a way that will benefit customers.'”

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Internally, her team explored the technology within the bank’s AI and data framework. This framework covered key principles, such as maintaining human oversight, removing bias, and considering socio-economic impacts, including how AI models consume energy.

To develop Cora+,  the team worked with experts from IBM’s Client Engineering team. The virtual assistant technology is powered by IBM watsonx Assistant and built on IBM Cloud.

This multichannel agent provides natural answers to customers using data from multiple sources, including products, services, and banking information.

Scaling up the platform

With the technology ready, the next stage was to test Cora+ with clients in a 12-week trial that started in June last year.

“We are very adventurous at NatWest about new things that can benefit our customers,” said Redshaw. “But we’re also very cautious about how we do things. So, we initially proposed a pilot to intertwine deterministic AI, Cora, with Gen AI, which is Cora+.”

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She gave an example of how the two technologies dealt with loan inquiries. Customers who asked about loans were directed to the right web page by Cora.

If a customer asked a detailed follow-up question, Cora would ask the customer if they wanted to interact with her more powerful generative ally, Cora+.

That question was important because the bank wanted its customers to know Cora+ was a pilot technology.

“Many people said, ‘I’m not sure I do want to do that,’ and would opt out,” she said. “And that was fine because we had a cap on the number of people who used Cora+ during the day.”

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However, most customers found Cora+ could answer their queries effectively in natural language. Estimates suggest the technology created a 150% improvement in satisfaction for some customer queries.

“We were surprised it was so well received,” she said. “That response gave us the confidence to go to the people who’d given us a cap on the number of conversations and say we would like to run this pilot for 12 months.”

Perfecting the strategy

Redhsaw said Cora+ has quickly found an important role in NatWest’s digitalization strategy and the approach will be honed as the bank develops data-enabled personalization.

“Seeing the activities that my team undertakes and the multiple branches we are exploring, I don’t see how the technology will not be the norm for conversational AI,” she said.

“We are finding out so much about how people and technology interact. Every day, Cora and Cora+ learn new things. And as a result, we’ve expanded what they can do together.”

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Redshaw said NatWest uses ChatGPT 3.5 for Cora+ alongside an unnamed GPT model. The second model is being trained to judge the output of the first LLM.

“We’re experimenting the whole time on the different elements of how AI can help,” she said.

While the innovations are delivering positive results, there are challenges to overcome.

Cora+ boasts a 98.5% accuracy rate. That’s an impressive figure, but it’s not the 100% success rate offered by a deterministic AI, such as Cora, using tightly constrained capabilities and data sources.

Redhsaw said the aim is to create generative AI services that provide as close to 100% accuracy as possible without taking undue risks.

“Our application of the technology shows enormous promise for doing things at scale,” she said. “I’m excited about those opportunities. I can’t discuss how we’ll develop the technology, but I’m excited about the potential.”

Taking the next steps

Beyond the benefit of improved customer experiences, Redshaw said implementing Cora+ has taught the business an important lesson: You can give your customers a more satisfying experience via emerging technology.

“That’s given us a sense of comfort,” she said. “There was always the possibility that this technology wouldn’t scale, wouldn’t behave itself, would hallucinate, and wouldn’t work well in an environment where it was constrained, severed from the internet, and only learning about bank-related things.”

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Her team also has learned it’s important to take nothing for granted, especially when implementing emerging technology.

“When customers were faced with the option of using Cora+, they didn’t always understand the terms, so that’s something to think about,” she said.

“But the good news is that, when they did use the technology, they had a very positive experience. So, that’s given us the impetus to think, ‘OK, what else can we do? What else can we teach Cora+ that would be good for our customers?'”