Amnon Shashua said the time is “ripe” for artificial intelligence tools to disrupt the private banking sector as his new digital bank One Zero prepares to expand its operations outside Israel.
Last year, Shashua launched One Zero, the first new Israeli bank in over 40 years, with investors including Swiss private bank Julius Baer, US private equity group Cerberus and China’s Tencent. plans to apply for a license in 2016. Italy by the end of the year.
The venture is one of a number of AI-infused projects launched by the 63-year-old computer scientist who co-founded and still leads self-driving group Mobileye, and has launched new generative AI products such as: Born as a wave of success. Like OpenAI’s ChatGPT and Google’s Bard, it has sparked investor enthusiasm for the space.
Shashua believes that the introduction of AI techniques, such as large-scale language models, into private banking will fundamentally improve the efficiency of relationship managers, making services previously available only to the very wealthy available to a wider range of people. He said it would be available to customers.
“This is a real mess in the banking world,” he said in an interview with the Financial Times. “And the reason only neobanks can do that is because they don’t have a legacy core system.”
Relationship managers at the Swiss private banks that dominate the global wealth management industry typically manage the operations of about 100 to 200 wealthy clients each.
With 60,000 customer accounts since launching last summer, One Zero’s Israeli operations have 1,000 customers per relationship manager and are on track to reach 2,000 by the end of the year.
But Shashua said the company’s long-term target is a ratio of 1:10,000, which will allow One Zero to bring services previously available only to very wealthy clients, such as bespoke financial advice, to a wider market. said it would be available.
Referring to clients that One Zero characterizes as having between $50,000 and $500,000 in disposable assets, he said, “The plan is to become the first purely pan-European digital private bank for the mass affluent. It’s going to happen,’ he said.
One Zero, which has raised $250 million and was valued at $385 million in its latest funding round in February, uses AI to analyze client portfolios and empower bankers to trade with them. Offer advice to share.
However, Shashua said the biggest scalability gains came from the introduction of generative AI — the powerful technology behind services like ChatGPT — allowing One Zero’s chatbots to respond to sophisticated customer queries. He said he expects to be able to do so, freeing up bank employees’ time for other tasks.
“When people don’t get an answer, they feel underserved, so this needs to be addressed either through human bankers or through automation,” he said. “The rise of language models…the time is ripe for this automation.”
Many banks already use chatbots to engage with customers, but chatbots typically offer customers the opportunity to choose from a set of pre-determined questions rather than responding to open-ended questions. Since it works by means of a
Nizan Gesurevich Packin, a professor of commercial law at the City University of New York, said generative AI could make banks more efficient in providing certain services.
However, applying this to personal financial data introduces a series of challenges related to technology biases and “hallucinating” tendencies (where AI confidently and inaccurately responds), as well as how customers Issues related to giving informed consent to the use of information also arise, she added. “We are still in the early stages of trying to understand what this means,” she says.
One Zero CEO Gul Bar Dear said addressing hallucinations and data privacy issues were the two main challenges the bank faced in developing generative AI chatbots. He said it was to avoid answering questions such as stock tip requests. that it was not allowed. But he said it has already been tested internally and the bank plans to roll it out to customers “in the coming months.”
Since studying Mathematics and Computer Science at Tel Aviv University, Shashua has founded companies that apply AI in areas ranging from robotics to natural language learning. But his biggest success was with Mobileye, which Intel bought in 2017 in the biggest deal in Israeli history before going public last year.
“It’s too early to talk about M&A,” Shashua said when asked if he would consider selling One Zero. However, he did not specify his future. “My interest is technology,” he said. “When the technology is perfect, I will no longer be a banker.”
