Robo-advice and artificial intelligence are not new to the financial sector; however, private banking is just making its first real steps. Tinkoff Bank’s assistant, Oleg, is prominent in its retail arm, but will it get into wealth management? Patrick Brusnahan investigates
Russia-based Tinkoff Bank is having an enviable 2020 so far. The branchless, online-only business reported a net income of RUB9bn ($120m) in the first quarter of 2020, an increase of 26% year on year.
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Then there is Tinkoff Investments, the bank’s online brokerage portal, which offers customers a low-cost and transparent platform for investing in a range of securities including Russian and international shares. The platform offers expanded access to over 10,000 securities from issuers in 30 countries. The Tinkoff Investments mobile app has now been installed more than three million times, and saw its number of active customers grow by three times in 2019.
Users are also seeing success on the app, with 80% of Tinkoff Investments customers making a profit. At the same time, Tinkoff was expanding the power of its chatbot, Oleg.
Speaking to PBI on the origins of Oleg, Konstantin Markelov, Tinkoff’s VP for business technologies, says: “Google and Amazon had already created an experience with Siri and Alexa. At the same time, we felt the need to develop our machine learning or artificial intelligence technologies in classic customer support.
“Oleg is based on chatbot technology, and he supports our customers with their questions. Today, his technology saves us between $3m and $4m a month, just on customer support.
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By GlobalData“We have many partnerships with universities, and in Russia there are very good AI engineers. We were able to develop a unique speech-recognition and speech-synthesis technology. So if we had all of these technologies that save money for us already, why don’t we create a voice system to make a good product for our customers?”
Oleg’s progression
Despite the popularity of voice and chatbots with bigtech firms, why has Tinkoff made it a staple of its offering?
Markelov explains: “Maybe the voice is the interface of the future. We don’t know today, but if you don’t do it, it won’t happen. If you do it, we can make it the future. Historically, we are trendsetters and disruptors, so it’s not a big question for us.”
Furthermore, there was also a practical reason for the bank, and its customers, to use voice technology. This is why it was fast-tracked and took only a year of development before release.
“Another reason is the size of our system. Our system is complex and complicated for customers. They need an interface to use it easily. Oleg is a guide,” he continues.
“When you want to find something, and you can’t, Oleg can help and do it in a friendly way. He can navigate you through our ecosystem – not only financial services, but also lifestyle services. You can make purchases within it, and Oleg can help with all these things. Oleg’s uniqueness is that he is a personal finance assistant.”
Oleg has many financial functions. The platform can help pay bills, make money transfers to peers and businesses, and many other functions. As a result, Tinkoff can see how 10 million customers “live their lives”, but how will it be implemented in wealth management and investments?
Markelov explains: “We have a lot of ideas to implement it in investments, because the main purpose or main goal of Oleg is to make our customers richer and financially successful.”
He continues: “Maybe you can remember the times when stock exchange brokers were sent out to buy or sell for you. Oleg will do it immediately, and he can make a recommendation to use for a suitable portfolio that matches your risk profile. If you want to use robo-advising, but you are not a professional, Oleg can help.”
So when can private banking customers expect to see these developments? Is Oleg going to be our financial adviser sooner than we think? Markelov concludes: “We want to implement this by the end of this year.”
