AI could cut banks’ servicing costs by 20-30%, BCG says

Banks are using artificial intelligence to do some tasks faster and more cheaply.

These tasks include checking loan applications, helping customers and collecting repayments.

BCG estimates that AI could lower the cost of serving bank customers by 20% to 30%.

Many banks are already reporting better process efficiency.

Some are also reducing costs in specific areas, such as collections.

AI may help banks understand people and small businesses that do not have much credit history.

This could make it easier for more MSMEs to receive loans.

BCG says AI could improve banks’ profits and help them handle more assets per employee.

In India, the technology may create growth by serving unmet demand rather than only replacing workers.