Search the top fintech trends for 2024, and you’ll find a common theme: Artificial intelligence (AI). These technologies are exploding. Transcribe video calls with key points summarized and time-stamped in seconds. Analyze complex databases by asking questions in human language. Code a new app with little to no experience or learn a new software step-by-step! And if you weren’t sure what other capabilities are out there, now there are user-generated custom GPTs for anything you can dream of.
It’s tempting to jump straight into the tools we’re using at RAIN, what we’re curious about, and what we recommend (or don’t) — but today, we want to explore the AI subtopic our bank and credit union clients ask about most frequently: compliance. (Note: If you’re here for the recs, check back soon for a Part Two post!)
Lots of newer technologies such as machine learning (ML) algorithms and generative AI center around accessing and interpreting massive amounts of data at unprecedented speeds.
So, it makes sense that we’ve seen an uptick in concerns, conversations, and debates about how AI tools used in business could impact compliance with finance industry regulations — particularly CCPA/CPRA and GDPR.
Here are the two questions we’re hearing most from our clients, along with some brief responses:
Q. Does AI-enabled audience segmentation break fair lending laws by excluding some demographics?
A. No — financial marketing tools reach broad audiences. As those audiences interact with our campaigns, AI helps us optimize campaigns by retargeting the users who have shown interest in our messaging.
Q. Does collecting consumer data with AI tools put financial institutions at risk for noncompliance with consumer privacy rules?
A. Nope. All mainstream AI marketing tools anonymize individual data, so we couldn’t identify individuals even if we wanted to.
Whew! Case closed, right?… Well, not quite.
There’s a deeper concern lurking here. After all, AI is just a technology — there’s nothing inherently sketchy about it, and there are countless documented examples of financial institutions using AI-powered tools to make work faster, more efficient, and more accurate, in full compliance with regulations.
With that in mind, the questions above don’t really seem to be about the apps bank marketers use or the reports we’re producing. Instead, they’re about the philosophies that underpin those services. You want to know you can trust your financial industry partners.
We think the real question is this: As financial marketing experts, what are the principles that guide us when we consider using new technologies?
The finance industry has strict rules in place to keep customers’ personal data from being used in harmful or predatory ways, and banks and credit unions trust their external partners to prioritize compliance, even above the other work we do.
At RAIN, we see ourselves as a vital part of your compliance team, not just your marketing team.
As our Head of Sales James McCool puts it: “Yes, of course, RAIN is utilizing cutting-edge AI solutions wherever we can to make our operations more efficient and effective, but we’re doing it carefully. We promise to take every precaution with every AI tool we use, ensuring no compliance guidelines are broken and no risks are taken.”
Our team’s approach to new technologies, including AI, can be summed up in two principles:
We’re working hard to leverage the best parts of AI, and with every new technology we evaluate or use, we’re making sure humans are the final word for process design, guidance, testing and approval.
James sums it up: “We know the most important factor for our clients in the finance industry is trust, and we take that seriously.”
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- Lynn Giroux, COO & EVP @ Essex Bank
