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Rory Brown, Managing Partner of Nicklaus Brown & Co., on Virtual Banking With AI Chatbots

Originally published on

You may find yourself interacting with a virtual bank chatbot to perform basic banking actions. Banks see chatbots as the next evolution of online banking. However, are consumers ready to trade off human interaction for convenience? Below Rory Brown, Cofounder of VirtualBank, weighs in on the future of virtual banking with AI chatbots.

Time is a Precious Commodity

Chatbots not only save time but also are more secure than interacting with people.  Virtual banks work every day to improve their systems and banks will employ the same security protocols, like strong encryption and two-factor authentication, as they roll out chatbots.

What’s at issue isn’t whether customer data will be secure using chatbots. The question is whether people will feel secure using chatbots. The trade-off only exists in the minds of consumers, but if virtual banks can’t convince consumers that chatbot banking is safe, it could hamper adoption.

What Banks Can Do

There are two approaches a virtual bank can use initially to inspire trust in their chatbot banking service. They can use signaling to establish the safety of the service, as well as create chatbots that feel human enough to trust.


Signaling uses visual cues to suggest security to consumers. Pre-online banking, bank branches were designed to signal financial security. Facades often used heavy marble columns to suggest solidity. Bars were placed over windows, and heavy vault doors were placed in visual range, all to indicate strength and impregnability.

Banking websites used the same approach when the technology was still new. Padlock icons. Images of confident banking professionals. These were visuals signals that suggested the website should be trusted, and they helped customers trust a service that was already secure.

Chatbots will need to incorporate similar visual and auditory signals. The service is already safe to use. Consumers simply need audio triggers to convince them.

The “Human” Touch

It’s one thing for a person to ask a chatbot, “What’s my current balance?” This isn’t much different than pressing an “account balance” button. But what happens if the question is, “I think my account might have been compromised. What should I do?” 

Eventually, chatbots will be intelligent enough to answer these sorts of questions, but if the answer feels canned, or cold and impersonal, the user is unlikely to trust the service in the future. To build real trust, chatbots need to respond with empathy. They need to feel like a caring human that’s trying their best to help. Banks should focus their AI development budgets on creating intelligence and personality.

Chatbots Are the Future

Wells Fargo has already released a pilot chatbot program, and many other banks are working on their own. The question isn’t whether chatbots are coming, but how long it will take until consumers trust them enough to use them, and that time frame will be determined by how well the industry can sell convenience and security.

About: Mr. Rory Brown has focused on financial technology and investment management for 30+ years. Rory Brown is currently working on a new app that will help consumers navigate online banking. The app will connect clients with the best virtual banks in the world, where they can get comparisons on rates for home loans, auto loans, and more.

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