Speaking at a consumer division presentation on Thursday (11 June), consumer division CEO Carolyn McCann said the bank would be moving to a digital-first service model, where its app and online services “will become our primary experience, not just a channel”, adding that “70 per cent of the things that you can do in a branch, you can do on the app”.

Westpac’s consumer division general manager of data, digital, and AI, Luis Uguina, said the bank can deliver a higher level of customer services at a lower cost digitally, adding that the cost-to-serve is “65 per cent lower”.

“Today, every three in four simple sales are executed digitally, and these numbers are growing 8 per cent month on month,” he said.

McCann provided the example of “simple-sale” interactions, which have an in-branch cost of $500 to complete, $200 in a call centre, but almost nothing on the app.

Westpac said this change was made possible by data and AI developments. Uguina added that the role of the technology has shifted dramatically from his time at Macquarie.

“One year ago, before I joined Westpac, the focus was purely on digitalisation: mobile apps, online journeys and straight-through processing,” Uguina said.

“To be digital-first [now], we now use digital, data and AI together to fundamentally improve how the bank works, and this is working for both the customers and the economics of our business.”

Uguina added that there are three things that Westpac wants to do “materially differently” with AI.

“First, make banking simpler and more intuitive for customers, [with] fewer steps, more relevance, and more personalised interactions. This supports our strategy on deepening relationships, improved retention and increased customer lifetime value,” he said.

“Second, improve how we run the bank and lift productivity. That means better decisioning, more automation in our operations teams, and using AI in our servicing capabilities.

“And third, doing this in a way that is safe, well governed [that is] consistent with expectations [as a] regulated institution.”

At the core of these changes is the data infrastructure Intelligence Layer that was revealed last November.

“The Intelligence Layer is a platform that will capture and process real-time signals, events, and behavioural patterns from our customers,” Uguina said.

“We will use this information to generate insights, predictions, and leads to support more personalised customer experience and [to] provide our bankers with a single view of the customer in the assisted channels.

“We will also improve fraud detection, offer dynamic pricing, and make more connected decisions. Obviously, this will help deliver more revenue per customer.”

The data the Intelligence Layer collects could highlight when a customer is considering moving banks, to which Westpac “will engage with them through the appropriate channel at the appropriate time with an appropriate savings offer”.

The technology will also be used to help customers, not just cut costs, according to Uguina.

“We are also thinking about how we are going to be using AI to help customers,” he said.

“We have a vision that we will be able to deliver personalised agents that will basically take the customer [through] the proper financial analysis and will be able to take care of the finance of the customer in many different ways.”

Uguina specifically mentioned the idea for a financial planning model.

“You tell the agent, ‘These are my long-term goals, these are my expectations, this is how I want to manage the money etc’ and then the agent would go to work,” he said.

“We think that we can do really well, generating capabilities that will keep our customers safe and fully focused on making their financial life easier.”