The Forrester Research report, The Future of Digital Experiences in Banking, reveals how artificial intelligence (AI), the Internet of Things (IoT), and edge computing are poised to revolutionise digital banking over the next decade.
The analyst posits that as financial institutions transition these from merely assistive technologies to anticipatory and ultimately agentic experiences, trust and transparency will be paramount in fostering consumer adoption.
The findings reveal that key innovations are reshaping the banking landscape. AI-powered virtual assistants are set to enhance customer interactions, delivering multimodal, intuitive, and emotionally aware banking experiences.
Financial institutions will harness the power of AI to offer tailored insights, while IoT-driven intelligence will enable embedded finance, providing real-time financial recommendations based on predictive insights.
Furthermore, the advent of 5G and 6G technologies will facilitate instantaneous analytics through edge computing, optimising efficiency and scalability for banking services.
Zhi-Ying Barry, principal analyst at Forrester, emphasises the delicate balance banks must maintain while leveraging these advanced technologies.
“Banks in Singapore and Australia that are looking to leverage AI and experiment with agentic AI are treading very carefully,” she notes. “There could be higher-risk scenarios where errors could have significant negative consequences, such as financial losses and reputational damage.”
Barry highlights the proactive measures being taken by regulatory bodies, such as the Monetary Authority of Singapore (MAS) and the Australian government, which have introduced ethical guidelines to steer firms in the responsible design and implementation of AI.
As an example, Barry cites DBS Bank’s initiative to align its AI strategies with the FEAT principles, further complemented by its own PURE framework.
“It’s not uncommon to see banks establish AI task forces or steering committees to assess AI's potential while ensuring human oversight.” Zhi-Ying Barry
The decision of consumers regarding which banks to trust will largely hinge on their confidence in AI technologies, the specific use cases presented, and their perceived risks.
Conversational banking is also highlighted as a vital evolution.
“Advancements in AI are set to further transform consumer interactions within financial services. The future of digital banking will be defined by modern, intuitive, and human-centred interfaces,” states Aurélie L'Hostis, another principal analyst at Forrester.
She elaborates on how AI-powered virtual assistants will enhance organisations' understanding of consumer intent and emotions, allowing for more personalised and engaging interactions.
As the banking industry stands on the cusp of this digital transformation, the role of ethical governance and consumer trust will be crucial in navigating the future landscape.
