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Applications of Artificial Intelligence in commercial banks – A research agenda for behavioral finance

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  • Königstorfer, Florian
  • Thalmann, Stefan

Abstract

Artificial intelligence (AI) is receiving increasing attention in business and society. In banking, the first applications of AI were successful; however, AI is mainly applied in investment banking and backend services without customer contact. AI in commercial banking with its focus on customer interaction has received little attention so far. Introducing AI in commercial banking could change business processes and interactions with customers, which could create research opportunities for behavioral finance. Based on this research gap, we conducted a structured literature review to identify applications of AI in commercial banks and the challenges of implementing AI. Our findings suggest that by using AI, commercial banks can reduce losses in lending, increase security in processing payments, automate compliance-related work, and improve customer targeting. Researchers worry about realizing technological advantages; the embedding of AI in business processes; ensuring user acceptance through transparency; privacy; and suitable documentation. Finally, we propose a research agenda for behavioral finance.

Suggested Citation

  • Königstorfer, Florian & Thalmann, Stefan, 2020. "Applications of Artificial Intelligence in commercial banks – A research agenda for behavioral finance," Journal of Behavioral and Experimental Finance, Elsevier, vol. 27(C).
    • Handle: RePEc:eee:beexfi:v:27:y:2020:i:c:s2214635019302503
    DOI: 10.1016/j.jbef.2020.100352
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    2. Rodrigues, Ana Rita D. & Ferreira, Fernando A.F. & Teixeira, Fernando J.C.S.N. & Zopounidis, Constantin, 2022. "Artificial intelligence, digital transformation and cybersecurity in the banking sector: A multi-stakeholder cognition-driven framework," Research in International Business and Finance, Elsevier, vol. 60(C).
    3. Wongsansukcharoen, Jedsada, 2022. "Effect of community relationship management, relationship marketing orientation, customer engagement, and brand trust on brand loyalty: The case of a commercial bank in Thailand," Journal of Retailing and Consumer Services, Elsevier, vol. 64(C).
    4. Omar H. Fares & Irfan Butt & Seung Hwan Mark Lee, 2023. "Utilization of artificial intelligence in the banking sector: a systematic literature review," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 28(4), pages 835-852, December.
    5. Cristian-Mihai Vidu & Florina Pinzaru & Andreea Mitan, 2022. "What managers of SMEs in the CEE region should know about challenges of artificial intelligence’s adoption? – an introductive discussion," Nowoczesne Systemy Zarządzania. Modern Management Systems, Military University of Technology, Faculty of Security, Logistics and Management, Institute of Organization and Management, issue 1, pages 63-76.
    6. Ahmed, Shamima & Alshater, Muneer M. & Ammari, Anis El & Hammami, Helmi, 2022. "Artificial intelligence and machine learning in finance: A bibliometric review," Research in International Business and Finance, Elsevier, vol. 61(C).
    7. Kumar, Satish & Rao, Sandeep & Goyal, Kirti & Goyal, Nisha, 2022. "Journal of Behavioral and Experimental Finance: A bibliometric overview," Journal of Behavioral and Experimental Finance, Elsevier, vol. 34(C).
    8. Leone, Daniele & Schiavone, Francesco & Appio, Francesco Paolo & Chiao, Benjamin, 2021. "How does artificial intelligence enable and enhance value co-creation in industrial markets? An exploratory case study in the healthcare ecosystem," Journal of Business Research, Elsevier, vol. 129(C), pages 849-859.
    9. Nataliya Vnukova & Inna Aleksieienko & Svitlana Leliuk & Yevheniia Malyshko & Volodymyr Chernyshov, 2024. "Information-analytical support to business processes for making investment decisions," Eastern-European Journal of Enterprise Technologies, PC TECHNOLOGY CENTER, vol. 3(13 (129)), pages 23-33, June.
    10. Daragmeh, Ahmad & Lentner, Csaba & Sági, Judit, 2021. "FinTech payments in the era of COVID-19: Factors influencing behavioral intentions of “Generation X” in Hungary to use mobile payment," Journal of Behavioral and Experimental Finance, Elsevier, vol. 32(C).

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    More about this item

    Keywords

    Behavioral finance; Financial service; Commercial banks;
    All these keywords.

    JEL classification:

    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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