As AI reshapes customer service in banking, NatWest’s pioneering chatbot Cora and its advanced iteration, Cora Plus, showcase the potential of AI-driven personalisation to enhance customer experiences and streamline operations. Mark Venables met with NatWest’s Product Director Miles Hillier at IBM’s AI in Business event to hear his views on balancing innovation with ethical responsibility in a regulated industry.
As artificial intelligence (AI) transforms industries worldwide, banking is emerging as a leading sector integrating AI for enhanced customer engagement, operational efficiency, and risk management. For NatWest, AI has become central to redefining customer experiences and the bank’s operational landscape, driven by a commitment to ethical, reliable, and innovative practices.
AI’s role in transforming banking customer service
Miles Hillier, Product and Technology Director for AI at NatWest, underscores AI’s potential to revolutionise customer service, bringing efficiency and satisfaction to unprecedented levels. “We were one of the first banks to introduce an AI-powered chatbot,” Hillier says, recounting the launch of Cora in 2017. “Six or seven years later, we have seen over 60 million customer interactions. This service initially focused on retail banking, but we have since expanded its use across other franchises within the organisation, supporting colleagues with the same Watson-based technology. Over these years, Cora has proven its value, delivering strong results in customer satisfaction and handling customer inquiries without needing to hand off to a human colleague.”
The introduction of Cora Plus, a generative AI-enhanced version of the bot launched in 2023, has further demonstrated the potential of AI in improving customer service. “With the arrival of generative AI, the bar has been raised,” Hillier explains. “The early results are impressive, showing up to a 150 per cent improvement in customer satisfaction and a 50 per cent reduction in the need to transfer to a colleague. It’s still in the early days, but we see enormous potential in further using this technology to enhance customer support.”
Navigating challenges as a first mover in AI technology
The journey toward pioneering AI-driven banking has been promising and complex for NatWest, particularly given the regulatory environment. “Launching new technology in a regulated industry comes with challenges,” Hillier notes. “We are taking a meticulous approach to ensure our AI deployments are ethical, robust, and sustainable in the long term. Large Language Models (LLMs) offer powerful capabilities, but they are trained on diverse data, both good and bad. Our challenge is to leverage the positives, like linguistic capability and contextual understanding while minimising risks.”
NatWest’s approach to AI deployment is rigorous and comprehensive, combining data customisation with robust quality control and risk management. “Our approach is threefold,” Hillier explains. “First, by training the AI on NatWest-specific data, using a retrieval-augmented generation (RAG) architecture, we tailor the model’s knowledge to our organisation. Then, we apply rigorous quality controls so the AI consistently delivers accurate, relevant customer responses. Finally, we use controls and guardrails to ensure that only high-quality, safe interactions reach our customers. This involves actively managing potential risks like toxicity or prompt injection. It’s an ongoing process, and testing with customers generates a cycle of continuous learning that helps us improve.”
The transformative potential of AI in banking
Reflecting on the broader impacts of AI within the industry, Hillier expresses optimism about its ability to reshape banking in ways reminiscent of the mobile banking revolution. “There is reason to be optimistic about the potential of AI,” he says. “We have seen how the mobile app revolution reshaped banking over the past decade, with app developers, designers, and testers becoming essential roles within the industry. AI has the potential to create similarly impactful new roles. Already, we have found that colleagues with customer service backgrounds in our branches and call centres bring invaluable insight when helping us develop customer-facing AI services, as they understand the customer experience at a deep level.”
Hillier believes AI offers an opportunity for human-AI collaboration rather than replacement, enhancing human contributions within customer service and creating new efficiencies. “We expect new roles to emerge around AI ethics, governance, and prompt engineering. AI can complement employees rather than replace them by serving as a toolset that enhances their effectiveness,” Hillier explains. “For instance, Cora Plus includes a summarisation feature, which allows Cora to hand over a concise summary of an interaction to a human colleague if it cannot resolve the issue. This enables our colleagues to focus more on the empathetic aspects of customer service, providing a personal touch while speeding up the resolution process.”
AI-driven personalisation and future customer experiences
Looking to the future, Hillier envisions a banking industry where AI-driven personalisation will set leading institutions apart. “Mobile-based disruption has defined the retail and commercial banking sector in the last 10 to 15 years. AI and digital systems will play a central role in defining the best, most digitally advanced banks. The banks with the best bots will be able to lead in customer experience, engagement, and outcomes,” he says.
Hillier sees a clear path for AI to revolutionise financial guidance, providing customers with the tools to manage and optimise their finances more effectively. “We see a tremendous opportunity to use AI to enhance customer experiences, make financial management easier, and help customers understand and achieve their financial goals,” he explains. “This technology could simplify the complex task of managing money, transforming how customers interact with their finances. AI can deliver significant value in new ways, beyond what traditional digital tools offer.”
NatWest’s ambitions for AI-driven personalisation extend beyond conventional customer service interactions. Hillier outlines how Cora’s future development aims to offer customers actionable insights tailored to individual financial goals and behaviours. “Our AI services like Cora are available to all NatWest customers through our public website and mobile app. However, we see an enormous opportunity to leverage this technology to go beyond simple FAQs and provide more personalised assistance,” he says.
Hillier highlights specific possibilities AI could unlock in personalised financial guidance. “For example, rather than just showing someone where their money is going, AI could help customers explore their spending patterns, compare their expenditures year-on-year, and assess whether reallocating funds might better align with their financial goals,” he explains. “We aim to deliver an interactive experience that can provide real value to retail investors and others managing their daily finances.”
Balancing innovation with ethical responsibility
As NatWest continues to push the boundaries of AI’s capabilities, Hillier underscores the importance of ethical responsibility and regulatory compliance. “Responsibly deploying AI is central to everything we do,” he states. “This includes ensuring the technology aligns with ethical standards, privacy regulations, and our own stringent standards. The data we use to train and fine-tune our models is carefully managed to ensure compliance and customer trust.”
At NatWest, data management goes hand in hand with ethical AI deployment to create a safe customer experience. “Having a human-in-the-loop approach is essential. Skilled individuals review AI-generated content and oversee any interaction between AI and customers,” Hillier explains. This oversight is particularly critical in high-stakes campaigns or when AI interacts directly with consumers. Tight guardrails and quality controls are fundamental to mitigating risks and ensuring our customers have a safe, positive experience.”
NatWest’s work in AI highlights the transformative potential and the complexities of integrating AI within a traditionally risk-averse and regulated industry. From pioneering chatbot technology to developing ethical frameworks for AI deployment, NatWest’s approach reflects an unwavering commitment to balancing innovation with responsibility. For Hillier, the future of AI in banking is about enhancing customer service and setting new standards for personalised, ethical, and future-facing digital banking experiences.
