Featuring insights from Ashish Garg, Co-founder and CEO of Eltropy, on the right approach to leveraging Safe and Responsible AI in financial services. This article covers the key principles that guide any community bank or credit union’s AI strategy, the importance of the human element in AI, and much more. Based on his original contribution to the Forbes Technology Council, here’s an in-depth look,

Two credit union representatives have the same task to perform. The first rep can handle one phone call at a time. The second is handling four members simultaneously through chat, and every conversation is enhanced by AI. Both are providing the same level of service, but one is servicing more members within the same time frame.

This is happening daily at credit unions and community banks across America. Nevertheless, as AI’s possibilities expand, it is crucial for community financial institutions to learn how to use this technology without jeopardizing the personal touch that is so characteristic of their service.

From Early Adopters’ Experience

I’ve seen companies incorporate AI into their member service operations and seen great results. The typical wait time to speak with a live agent diminished, and the quality of service was higher owing to more consistent responses across the various channels.

However, the numbers are not the only part of the story. What is most significant is how they did this. They didn’t try to automate every part of the business but rather targeted certain areas in which the AI could help their existing staff. First, they started with chat support, which would allow representatives to handle three to four conversations at a time instead of one. It was a gradual approach, which allowed them to learn and make changes without affecting the service delivery.

This approach—using AI to enhance, not substitute, human capacity—is a model for implementing innovation.

Ethical AI Implementation Principles

Based on successes I’ve seen and experiences I’ve learned from across the financial sector, there are several key principles that should shape any community bank or credit union’s AI strategy:

• Customer confidence comes from transparency. Customers should know when they’re interacting with AI rather than a human representative. Establishing clear channels of communication and making sure customers can easily move to human support helps build confidence in new technologies.
• It must not be biased. AI systems should serve all customers and members equitably, independent of their technological literacy or financial well-being. This means rigorous testing for bias and keeping alternative service points to ensure no member is left behind.
• Ensure correct usage of the technology. A strong governance framework with clear audit trails and human oversight of significant financial decisions eliminates algorithmic errors and guarantees that AI capabilities are aligned with customer interests.
• Privacy protection is nonnegotiable. Financial data is very sensitive, so security has to be built into AI systems and not added as an afterthought. Standard features like encryption, access control and regulatory compliance should be part of any AI project.
• The need for continuous monitoring sustains excellence. Due to the dynamic nature of AI, constant attention is required. It’s important for community financial institutions to have real-time monitoring systems in place and perform risk assessments often to determine any risks that may be imminent to customers.

The Human Element Remains Central

The best AI programs are those that follow the “human in the loop” model. This means creating a unique position where the staff could address the challenging issues while the AI dealt with the basic issues. The result? Employee satisfaction can increase because staff members are able to work on more rewarding tasks.

Recent industry research supports this approach. According to the Infosys Knowledge Institute, financial institutions are more likely to be successful in terms of operational effectiveness and customer satisfaction when they apply AI to support human functions rather than trying to automate them.

Start With Purpose And Care

Credit unions and community banks could begin by using AI to answer customers’ questions through chat, provide consistent information across all the service channels, notify customers of suspicious account activity while allowing for human intervention, or schedule appointments and provide video banking services.

This is illustrated by my own experience. If you begin with the basic chat functions and then move to video banking and other services, you can continue to learn about them.

Looking at the road ahead, the community financial institutions that will succeed will be those able to find the right balance between technology and personal touch. This means ensuring that customer information is secure, helping staff work effectively with AI tools, having someone responsible for AI-driven decisions and evaluating regularly how these changes are impacting customer satisfaction.

The most important thing to remember is that AI should make the credit union or community bank experience better for customers, not just faster or more efficient. Success comes when customers feel their institution understands and responds to their needs in the best way possible while still keeping that personal touch. That’s when we know we’re using AI the right way.