Many technology pundits have hailed 2016 as “The Year ofArtificial Intelligence.” However, in the interest of fulldisclosure, about a year ago many technology pundits – perhaps thesame technology pundits – similarly hailed the coming of 2015.

If the pundits are finally right, it will have been a long timecoming. The term artificial intelligence, or AI, was firstcoined by computing pioneer John McCarthy in 1955. McCarthy simplydefined AI as “the science and engineering of making intelligentmachines.”

Even if this doesn't prove to be a watershed year of AI as abroad discipline, it does seem to be making some significantinroads into the financial services industry. And while thetechnology is still relatively rare (translation:expensive) in financial services, like all otherworthwhile technologies, AI is bound to become more pervasive (andless expensive). That means, if nothing else, AI is worth keepingan eye on.

What Can AI Do for Me?

Maybe it seems like there isn't much of a place for AI in anaverage credit union. If that's what you think, think again. AI isreally all about creating technology that is capable of makingintelligent decisions. And what is a credit union if notthe sum total of all the decisions made by its employees andexecutives? Plainly stated, AI can help a credit union make betterdecisions.

Consider your CRM system (or MRM system, if you insist), forexample. It probably includes basic tools to help your employeessuggest likely “next” products to your members. This is predictiveanalytics at its simplest.

However, if you apply more powerful technology, and give thattechnology more data on which to chew, the results of yourpredictive analytics will become much more accurate. With anAI-enhanced CRM system, your member service representatives couldfind themselves offering each member precisely the financialproducts he or she needs, precisely when they're needed, all to thebenefit of your credit union's bottom line.

What about the MobileCrowd?

AI can also be used to enhance your members' mobile experience.For example, a company called Kasisto makes AI software thatpotentially allows your members to have a natural-language“conversation” with their records at your credit union.

For example, a member might ask, “How much did I pay on my cablebill last month?” The Kasisto software would instantly translatethat question to text, figure out what the member is really askingfor, find the answer, and then speak the answer back to the member.Think of it like Apple's Siri, except exclusively for financialservice environments.

Superhuman Analysis

AI systems are also being developed that can uncover trends andinformation that are beyond the capabilities of mere human beings,at least when those human beings are constrained to any reasonabletimeframe.

For example, another company called Kensho is developing anatural-language analysis tool for big banks and high-end traders.As reported in The Economist a few months ago, “Kensho'ssystem is designed to interpret natural-language search queriessuch as, 'What happens to car firms' share prices if oil drops by$5 a barrel?' It will then scour financial reports, companyfilings, historical market data and the like, and return replies,also in natural language, in seconds.”

Will your credit union invest any of its IT budget in AI thisyear? Probably not. Should you keep AI on your radar so you'reaware of any activity in the big-bank space? Probably so.