American Express Plans to Use AI to Make Card Approval and Line of Credit Decisions

Financial services company American Express (AmEx) is planning to use generative AI to improve customer experience across its credit cards and bank offerings.

The company aims to use AI services to validate transactions, approve lines of credit, analyze customer sentiment, and predict customer finances, according to a report by Venture Beat.

AmEx’s Digital Labs, a division of the company formed in 2017, has been working with AI for financial services.

It has already integrated Mezi, an AI digital assistant that makes customer travel booking recommendations, into an AmEx mobile app pilot program and created the company’s Rewards Checking account.

“We launch 20 to 25 pilots a year,” Laura Grant, VP of product development for emerging platforms and AI at AmEx Digital Labs said, adding:

“We look at technology from the perspective of, ‘How is this going to impact our customers and make their lives better?’”

AmEx Digital Labs envisions using generative AI to assist with transaction approval as well as predictive analytics, predicting how users will perform over time and approving cards and lines of credit.

The division is also exploring new ways large language models (LLMs) could be used to analyze customer feedback and inquiries through AmEx’s existing customer service portals and social media and to understand how to deliver appropriate and helpful responses.

Amex is getting fancy with AI to approve transactions & credit lines! They’re teaming up with AI hotshots like Microsoft instead of making their own. They’re taking it slow & steady, just like they did with crypto. #Amex #AI #Microsoft

— 2022M3LR (@evboxfan) May 29, 2023

AmEx Intends to Use AI With its “3 Ps”

AmEx Digital Labs seeks to understand how new technology can help with its “3 Ps”: making a product more personalized for an individual customer, more proactive, and more predictive.

The three Ps refer to the three key variables that are crucial to a business’s success, and include people, process, and product, also referred to as the triple bottom line.

Notably, AmEx does not currently plan to develop its own homemade LLM using its financial services data, preferring to partner with others.

“Our hypothesis at the moment is that we would be better suited using LLMs through partnerships. I don’t see us spinning up our own LLM from scratch,” Luke Gebb, senior vice president of American Express Digital Labs, said.

The company, however, did not disclose which partners it intends to work with.

AmEx Takes Cautious Approach to AI

While its experiments with generative AI are in their earliest phases, AmEx’s Digital Labs is taking a cautious approach.

Due to the critical importance of its product offerings—affecting customers’ bank accounts and credit lines —and the associated hefty amount of government regulations in financial services, AmEx Digital Labs wants to make sure to approach all of its experimentation with AI very cautiously and securely.

“We are ring-fencing,” referencing the broader security approach that limits software applications and the data they can access.

The move by AmEx to explore AI comes as companies try to integrate this emerging technology into their products in order to improve their offerings.

A recent survey by KPMG found that 65% of 225 executives surveyed believe that generative AI will have a high or extremely high impact on their organization in three to five years.

However, 60% say they are still one to two years away from implementing their first solutions and anticipate spending the next six to 12 months increasing their understanding of how generative AI works, evaluating internal capabilities, and investing in new tools.

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