Financial institutions are looking to real-time, data-driven insights to suggest actions clients can take to benefit from last week’s interest rate cut by the Federal Reserve.  

Banks have already been strengthening their client relationships by leaning on data and analytics to offer clients specific products that help them save for retirement or home purchases. 

Now they can use that data-driven strategy to help clients navigate a changing rate environment, Jody Bhagat, president of Americas at AI-driven fintech Personetics, told Bank Automation News. Tel Aviv-based Personetics’ clients include Cincinnati, Ohio-based Union Savings Bank, Turkey-based AK Bank and Bank of Phillippines Island. 

“By analyzing customer transaction data, [banks] can quickly identify how each [consumer] can benefit from rate cuts,” Bhagat said.  

The Fed sliced its benchmark federal funds rate by 50 basis points Sept. 19, its first rate cut since 2020.  

The older playbook of banks tending to a customer’s needs has changed with the advancements in data analytics and AI. In the past, only high-net-worth clients received a personalized experience due to banker availability, Bhagat said. But, with the help of AI, banks can now provide personalized services at a much larger scale and more quickly, he said. 

Looking at customer’s transactions data and patterns, a bank can see whether they have, for example, a savings account at a different institution and provide them with a better offer to bring that money back to them, Bhagat said. AI can also help banks predict a consumer’s needs and sell them the necessary product. 

While “AI can’t replicate the empathy of a banker,” it can be very precise about a consumer’s needs and how they can benefit from changing rates, Bhagat said.