Powered by MOMENTUM MEDIA
subscribe to our newsletter

Artificial intelligence could help customers reach home ownership goal

An Australian bank will use artificial intelligence to assist customers in budgeting and reaching their home ownership aspirations.

UBank has announced plans to use AI similar to fitness tracking apps to help address budgeting and saving problems for Australian consumers.

The technology, due to be launched late this year, will help customers track their daily spending and savings said Leo Hatton, UBank CEO.

“Our goal is to help our customers take control of their financial positions more closely so they can achieve their bigger dreams, including home ownership.”

Research by UBank found that two million Australians have less than $1,000 saved while 61 per cent don’t have a dedicated savings plan and 35 per cent are without a savings account. The bank also pointed to Galaxy Research showing Australians spend $31 billion intended for savings annually.

Advertisement
Advertisement

“Using AI, we will create an experience within our internet banking platform to help customers plan for ‘regular’ expenses such as monthly phone bills and also ‘irregular’ costs like car insurance, which need to be paid less frequently. With money set aside for these kinds of expenses, customers can then manage their daily spending allowance and savings plan more effectively.”

An experiment

The development of the technology was informed by an experiment by UBank and Dr Phil Harris, a consumer neuroscience expert which tested 50 respondents, aged 22-50, on their thoughts on saving.

The experiment was divided into two parts, the first in which respondents answered questions about financial scenarios. The second section saw respondents presented with their ‘future self’ – an image manipulated to age the respondent by 10-20 years – and then answer more questions about financial scenarios.

“After interacting with visualisations of themselves later in life, 72 per cent of participants shifted their mindset towards wanting to save, versus spend money,” Dr Harris said.

PROMOTED CONTENT


He observed that by “being in touch” with future selves, respondents were more likely to choose to save money.

“When putting participants through the first round of financial scenarios, the results showed that it took a large sum of money to tempt people into depositing money versus spending it. But once they engaged with their future self, it took a significantly lower amount to tempt participants into wanting to save money.

“This shows that while our natural default setting is to seek immediate rewards, there is a way to train your brain to become financially smarter.”

[Related: Indigenous home ownership rates improving but still low: Census]

Artificial intelligence could help customers reach home ownership goal
mortgagebusiness

Are you a new-to-industry broker in the process of growing your business? Then there’s some great news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights into cutting-edge tools, strategies and processes to fast-track to success. Don’t miss your chance to attend. To secure your FREE place, visit newbroker.com.au now!

Latest News

The chief of Australia’s largest bank has said lenders should act pre-emptively and shift their floor rates for mortgage serviceability am...

Total household wealth reached a high of $13.4 trillion in the June quarter, primarily due to rising property prices, according to the Aust...

The property exchange settlement platform has been granted approval to establish an Electronic Lodgement Network in the ACT.  ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.