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ILP Institute Insider

June 26, 2018

Who said banking was boring?

HSBC Bank Announces Partnership with SoftBank Robotics via launch of the first interactive social humanoid robot interface in a major retail bank setting.

Daniel de Wolff

On June 26th, 2018, MIT ILP member company HSBC Bank announced a new partnership with SoftBank Robotics (Softbank Group), the world leader in robotics with a substantial Boston-based R&D presence. A collaboration between multinationals of this magnitude is significant in of itself. However, the manner in which they chose to announce, signals not only the intent of these two global brands but also the principle around which they are rallied: technological innovation.

Enter Pepper, the first social humanoid robot to utilize best-in-class emotional AI and the latest technology in natural language processing. HSBC’s U.S. headquarters building and flagship branch, located at 452 5th Ave in Manhattan, is Pepper’s newest home, which means several noteworthy firsts: Pepper’s first deployment at a major retail bank in the United States, Pepper’s first opportunity to help customers in New York City, and the first time a robot will be engaging in conversational interactions with retail banking customers. Pepper is WIFI enabled, weighs 25kg, and utilizes a series of cameras, microphones, and sensors, not to mention 20 motors and a 10.1-inch touchscreen. Behind the scenes, and equally as impressive as Pepper’s humanoid form and dexterity, are the proprietary machine learning algorithms that define her aptitude for meaningful human interactions.

(From left to right)
Jeremy Balkin, Head of Innovation;
Juliana Cole, Innovation Manager;
Pablo Sanchez, Head of Retail Banking
and Wealth Management
for HSBC in North America

Since joining HSBC to head up the Retail Banking and Wealth Management business, Pablo Sanchez has been focused on developing 'the bank of the future.' Sanchez tasked Jeremy Balkin, Head of Innovation for the bank’s Retail Banking & Wealth Management businesses, with executing the vision, making him the driving force behind the partnership with SoftBank. Balkin, who played a key role in formalizing his institution’s collaboration with MIT ILP in November of 2017, is not shy about heaping praise on the Institute for informing his work. “HSBC’s partnership with MIT ILP inspires my thinking and emboldens our work on a daily basis, as evidenced by our pursuit of this most recent partnership with SoftBank,” he says.

Under Pablo’s leadership and Balkin’s guidance, HSBC’s U.S. retail business has been on a significant run in terms of technology investment of late, including the introduction of Touch ID, voice biometrics, and a new online banking platform, all of which coincide with HSBC’s global efforts to invigorate their digital capabilities.

Approximately 2 million people walk within a half mile radius of HSBC’s flagship branch every day. A study conducted by HSBC’s Innovation team determined that of the total 5th Avenue daily foot traffic, four times as many HSBC customers were using the 5th Avenue ATMs than were actually entering the flagship branch. Based on the implications of the data collected, the team worked with the branch staff to understand the best ways to engage current and future customers who enter the branch and how to deliver a world-class retail experience like other 5th Avenue retail storefronts. Balkin says, “We listened to our customers as the data also suggested that customers of our flagship branch are 50% more digitally active than the average HSBC customer in the U.S.” He recognizes that “millennial consumption patterns are influencing all consumption patterns,” and in the age of the Apple store, even a retail bank must offer consumers something more if it hopes to compete for attention and customer loyalty.

He’s confident that Pepper will drive foot traffic and provide customers with a “more engaging, dare we say fun, banking experience.” Pepper’s interactive, voice-enabled interface allows for back-and-forth conversation in a similar way to Amazon Echo, Siri or Google Home, and she is more than just a novelty item. In addition to greeting customers, Pepper will ask some initial questions to determine how HSBC can best meet their banking needs, help educate consumers on basic product information and the availability of self-service banking options, direct foot traffic to the right person, and answer generic queries, thereby reducing wait times and freeing up employees for more pressing tasks.

Which is all to say that Pepper will define herself as a complimentary workforce tool, capable of enhancing efficiency and productivity of all branch staff. Pepper even seems to have a knack for improving morale according to one bank manager, who says he can’t remember the last time he saw his team and customers smiling so frequently. Combine all of these factors with the possibility that for a future wave of young roboticists, Pepper might be their first interaction with a social humanoid robot, and Balkin has good reason to believe he’s more than fulfilling his role leading Innovation for HSBC, one of the world’s largest and most iconic financial institutions.

Speaking of the future and partnerships, Balkin’s enthusiasm is palpable as he reflects on HSBC’s relationship with MIT ILP: “The thought leadership and insights from MIT enhance and compliment the work our team does leading innovation inside such a large organization. We truly hope to deepen and broaden the scope, as more executives across HSBC (both in the US and across our global network in 70 countries) become more accustomed and open to MIT best practices and thought leadership.”