Artificial intelligence is no longer looming on the horizon—it’s here, and it’s now significantly impacting daily life. With innovative startups coming onto the fintech scene, the behemoths of the banking industry are being forced to improve their digital game, and AI is playing an important role in doing so. These big banks have the budget to be the first movers, but it’s almost certain the AI pioneered by the “Big Four” will soon be widely used in the financial industry and beyond.

Check out some of the latest developments for AI in banking and what wide-ranging impacts those developments may have for the future of banking.

1. Chatbots are tapping into human emotion

Clunky first-gen chatbots gave the technology a bad name. Today, they’re a lot smarter thanks to machine learning and natural language processing, and they’ll continue to get more intelligent as the tech advances. Customers are already becoming more inclined to interact with chatbots—especially if it means they can avoid long telephone queues, and that trend will likely continue over time, as well.

The Commonwealth Bank’s Ceba chatbot showcases how advanced chatbots are becoming. Launched in January 2018, it could recognise approximately 60,000 different ways customers could ask for the 200 most common banking tasks. That number is expected to rise by the end of the year. Meanwhile, National Australia Bank’s virtual banker can recognise 13,000 variations of 200 common questions from its business banking customers.

As impressive as modern chatbots are, they possess neither emotional intelligence nor encyclopedic knowledge. Like their predecessors, they’re designed to address queries on a limited range of specific topics. Nonetheless, the more sophisticated offerings now available should convince chatbot-holdouts to get with the program. If your organisation hasn’t transferred the handling of common first-level customer service tasks from humans to machines, you may want to consider doing so soon. If you already have some deployed, prepare for an imminent chatbot upgrade.

2. Smart assistants are getting more clever

Australia’s banks are making the most of smart assistants, both those running on handheld devices and the new generation of smart speakers. Both NAB and Westpac, for example, let customers check account balances and perform other tasks using Amazon’s Alexa or Google Home. ANZ is working with voiceprint and biometrics company Nuance to enable voice ID for transferring funds via the ANZ banking app, too.

While still in its early days, it’s important for IT teams to prepare for the role AI will play in their organisation’s omnichannel digital strategy. This includes devising a roadmap for how AI will handle more advanced tasks and interactions to meet the growing expectations of customers. Historically, an omnichannel approach to customer service has focused on cost savings—driving self-service options to reduce the cost of engaging with customers, even if it came at the expense of customer satisfaction. Increasingly, AI will focus on improving the customer experience and adding value, rather than just replicating existing digital services via yet another channel.

Ultimately, your team will be tasked with ensuring customers enjoy a seamless experience as they move between channels while interacting with an organisation, so start thinking about how to solve that challenge today.

3. Virtual tellers are becoming a reality

Many technological advances in the banking sector are designed to reduce the number of customers walking into a branch. But even those customers who walk up to the counter are set to experience the impact of AI in banking. For instance, in Chennai, a humanoid robot called Lakshmi helps City Union Bank customers with queries on more than 125 subjects, including account balances and mortgage interest rates. Since debuting at the bank’s T-Nagar branch, Lakshmi now appears in other City Union Bank branches around India.

Meanwhile, at the Bank of Tokyo Mitsubishi UFJ, a robot called Nao is interacting with customers in Japanese, Chinese, and English by analysing visual cues, such as facial expressions, as well as spoken requests. Nao is helping customers with currency exchanges, money transfers, and other banking questions at several branches. Rather than using a robot, New Zealand’s ASB has launched Josie, an onscreen digital assistant located in its branches. Created by Auckland-based FaceMe, the lifelike Josie guides customers through their questions about starting and operating a business.

You know all those “robots are coming for our jobs” think pieces you’ve been rolling your eyes at? As it turns out, they really are in some capacity, at least when it comes to the future of banking—and, quite possibly, the future of your industry. Your IT team probably won’t be creating the robot in question, but it may well be in charge of its installation and maintenance.

4. AI is starting to understand its customers better

Beyond offering personalised customer experiences without the need for human interaction, AI is also underpinning efforts by banks to better understand customers.

Several Australian banks are reportedly in discussions with Israeli-based artificial intelligence fintech firm Personetics, which has developed a cognitive banking brainthat learns about customer behaviour and activity. Personetics is already in use in the United States, Europe, and Asia, where it helps banks anticipate a customer’s financial needs. The technology helps banks hone their cross- and up-selling efforts. It also offers customers personalised advice when it comes to meeting their financial objectives.

It’s only a matter of time until Personetics—or a business like it—is promising your company’s CEO it can pump up sales. It’s not clear what, if any, role your IT departments will have when this happens, but forewarned is forearmed.

5. Regulatory and risk management is improving

IBM’s AI-powered Watson Financial Services division is conducting trials with Australian banks, using cognitive computing to assist with regulatory compliance and fraud detection.

Studying government regulations to become a subject matter expert, Watson can assist bankers in identifying regulation obligations across different parts of the business. It can also help with detecting fraud, insider trading, and money laundering, as it can go beyond traditional pattern matching and see the big picture. If your organisation is in an information-intensive field (e.g., education, government, health, law, or telecommunications), there’s a chance you’ll also be Watsonised sooner or later.

By this point, it should be clear the banking industry is changing fast, and the future of banking just might reflect the future awaiting all industries. If you start preparing now, you can help your company stay one step ahead in the AI race.