Bank of Montreal’s head of Canadian personal and business banking wants every customer to have their own banking concierge.
Within five years, Mat Mehrotra imagines a world where clients will handle everyday banking tasks with the help of an AI-powered personal assistant.
Customers will be able to ask an in-app chatbot to pay their bills, make an e-transfer to a friend or send them a reminder of a scheduled transaction, for example.
“My dream AI use-case is basically that you put AI in the hands of clients and it’s used to drive much more streamlined banking for them for the things that are simple,” Mehrotra, whose division serves more than seven million customers across Canada, told the Star in an interview.
BMO is betting big on AI as part of its core strategy.
Earlier this month, the bank announced the establishment of the BMO Institute for Applied Artificial Intelligence & Quantum — a research and development centre focused on “responsible innovation, application and governance” of AI.
BMO expects AI to add more than $1B in earnings by 2030
The bank also recently appointed Kristin Milchanowski as its chief AI and quantum officer.
BMO expects the deployment of the nascent technology to add more than $1 billion in pre-tax earnings by 2030. Other Canadian banks, including RBC and TD, are forecasting a similar financial impact from their own AI investments in the coming years.
Part of that benefit, BMO says, will come from improvements in employee productivity as well as using AI to personalize and market offers to clients.
Mehrotra didn’t directly comment on whether AI-driven earnings at the bank will translate into lower fees or interest rates for Canadians.
“The way our clients will feel this predominantly is through the experience,” he said, citing “better conversations with our employees” and “more personalized experiences.”
“That ultimately will lead to, as I said, this real financial progress. That is how we measure success for the business.”
Branch employees already have access to a chatbot called Lumi that allows them to quickly comb through 8,000 bank policies and procedures documents while they assist clients, resulting in more efficient customer service, according to the bank.
“Today, it’s basically helping them navigate policy, procedure, or process,” said Mehrotra. “Tomorrow it will help them understand clients.”
The next step is to have Lumi help branch employees prepare for conversations with customers around mortgages and other products by giving the chatbot access to their profiles.
Employees will be able to ask the chatbot questions about the customer such as “what needs have we not met yet?” and “what’s changed in their financial picture?” according to Mehrotra.
BMO also plans to launch Lumi in contact centres, so workers can better assist clients over the phone.
“We are continuing to advance our conversational banking experience to support and ultimately build toward the concierge experience,” he said.
There are concerns, however, when it comes to AI-personalization in retail financial services.
AI can amplify bias and lead to ‘erosion of consumer trust’
A January report by the Financial Conduct Authority (FCA), a financial regulator in the U.K., said that while AI can enable banks to better meet customer needs, it also threatens to reduce consumer agency and financial literacy.
“Agentic AI in particular could support people to automatically optimize their household finances,” wrote Sheldon Mills, executive director of the FCA. “But AI can also amplify risks: bias, discrimination, exclusion, opaque decision-making (particularly when multiple AI models interact), misleading or hallucinatory advice and erosion of consumer trust.”
Moshe Arye Milevsky, professor of finance at the Schulich School of Business, refers to AI-personalization at the banks as “targeted marketing.”
“We need more people in the branch that are comprehensive financial planners that can actually give holistic advice,” he said.
“Where you sit down and you take a look at every single item that this person has on their personal balance sheet and all their liabilities and figure out a financial plan for them,” added Milevsky. “If they can use AI to do it, that would be great.”
Jean-Paul Bureaud, CEO of advocacy organization FAIR Canada, however, warns that consumers should keep in mind that just because offerings appear “hyper-personalized,” that doesn’t mean they’re actually tailored to their specific financial circumstances.
“The real risk there is blurring the lines,” he said, “between what is marketing and what is advice.”
Mehrotra said clients will be able to opt-out of AI-personalization if they want to.
“We absolutely respect our clients’ marketing preferences and obviously abide by all applicable regulations and the way that we use data is in line with privacy rules,” he added.
“Like any emerging technology, we approach it with the careful consideration that it deserves.”
