The Consumer Financial Protection Bureau yesterday painted a target on artificial intelligence, issuing an advisory about banks and companies in the financial services industry using the technology in chatbots, saying it can lead to violations of consumer finance laws and harm consumers by providing inaccurate information and diminished customer service.
A copy of the advisory can be accessed by clicking here.
About 37% of consumers interacted with a bank’s chatbot in 2022, the CFPB mentioned in the report. Each of the nation’s top 10 banks have chatbots of varying complexity that can be accessed by its customers. The technology is more cost-effective than having humans staff online chats and banks are rolling out more sophisticated chatbots that are based on generative artificial intelligence tools like large language models. While the chatbots may be effective at handling basic inquiries, consumer complaints filed with the CFPB indicated that more complicated inquiries yielded confusion and an inability to obtain tailored support.
Chatbots might not be as flexible as humans at understanding inquiries from consumers, such as when they are disputing accounts, the CFPB said. Unless specific language or terms are used, the chatbots might not pick up on the fact that a consumer is disputing a transaction. “A chatbot with a limited syntax can feel like a command-line interface where customers need to know the correct phrase to retrieve the information they are seeking,” the CFPB said.
There is also the chance that the information provided by a chatbot may not be correct. ChatGPT hallucinates and makes up information when it doesn’t know the answer to a prompt, and that could lead to disastrous consequences for consumers. As more consumers use this type of technology for financial advice, the importance of making sure the information that is returned to consumers is accurate becomes more important, too.
The banking industry responded to the report with data of its own, noting that the overwhelming majority of consumers are satisfied with their bank’s customer service.
“America’s banks support responsible innovation that benefits consumers and offers the safeguards that come with a banking relationship,” said Brooke Ybarra with the American Bankers Association, in a published report. “As technology reshapes consumers’ needs and expectations, tools like chatbots offer an additional medium to help banks expedite the customer experience. These innovations complement more traditional interaction with a customer service representative which remains an option. There are many ways consumers can communicate with their bank, and recent surveys show the overwhelming majority of customers rate their bank’s customer service highly.”