Why Advisors Are Still a Long Way From Embracing AI: Schwab

Conversational artificial intelligence, natural language processing and voice could be the next disruptive technologies in the financial services industry, but there continue to be barriers to advisors and clients of theirs and other financial institutions accepting these technologies, according to Kyle Caffey, managing director of conversational AI at Charles Schwab, and Swapna Malekar, product lead at RBC. "Financial use cases can be more complicated, and so delivering a good client experience could certainly be a part of that adoption barrier," Caffey said last week while speaking during a "Future Focus" session at the Finovate Fall Digital online conference. Another big issue is that "the nature of the data that we're relying on and passing through some of these technologies is sensitive," he said, underscoring the importance of risk management. Schwab has been careful with privacy and the "security of our clients' data as we pursue some of these technologies -- and that's something that we've been very mindful [of] as we've executed on our vision and road map, and it's something for any financial services firm or bank that's considering deploying conversational AI … to make sure they're paying attention to," he said. In most cases, business use cases for technology are "built on either a revenue plan or an expense savings plan," he noted, adding: "Certainly, conversational AI brings to bear capabilities on both sides of the business case." But Schwab "really started with the client experience and thought about'how do we make our digital ecosystem as accessible and simple for our clients [as possible] to get them what they're looking to get done?'"