Temenos has (SIX: TEMN) today launched an industry-first secure solution for banks using Generative Artificial Intelligence (AI) to automatically classify customers’ banking transactions.

Transactions classification helps banks provide personalized insights and recommendations, offer more engaging and intuitive digital banking experiences, and enhance customer loyalty through more relevant products and offers.

A leader in Explainable AI, Temenos is the first to deploy Generative AI and Large Language Models (LLM) in banking with a solution for transaction classification. Traditional AI/ML systems are already paving the way, improving operations, and enhancing customer experiences. However, Generative AI and LLM can better understand language, video, audio, images, and code to generate new outputs of different modalities. Hence, the rise of Generative AI promises to unleash a wave of innovation and personalization, revolutionizing how organizations interact with customers.

Temenos’ new Generative AI solution enables banks to classify and label customer transactions from free text narrative automatically and with a high degree of accuracy in different languages. Fast and accurate classification of transactions is important for many banking use cases, from next best product, cashflow prediction, customer budget advice, peer grouping, customer attrition analysis and many others.

The Temenos Generative AI solution is part of the Temenos platform and is packaged with Temenos’ digital banking capabilities. Furthermore, it can be deployed as an independent capability for banks to connect with their existing core system through APIs with little or no additional integration. The new product provides a secure Generative AI solution where the models are trained on anonymous data and in production, the final models are deployed in the customer environment with no need to exchange information with a third party.

In a pilot with BlueShore Financial, Temenos’ Generative AI solution was used to provide personalized insights on income and expenses. With their banking app, clients would be able to view income from various sources such as salary, interest, dividends, and rental income, with sections aligned with Canada’s tax categories to check their intra-year tax burden reconcile end-of-year tax reporting. A ‘Year in Review’ feature, with statistics on spending and saving, and comparisons to others in their cohort, provides an interesting way for customers to view their financial highlights.

Fred Cook, CIO, BlueShore Financial, said: “At BlueShore Financial we are passionate about improving our clients' financial well-being in an interconnected, digital world. Data and AI are critical to our strategy, and we are excited to safely and securely leverage new technologies that deliver innovative new customer experiences.”

Prema Varadhan, President Product and COO, Temenos, commented: “Temenos is at the forefront of AI in banking. The first to bring true explainable AI to the financial services industry, which helps financial institutions explain in simple business language to customers and their clients alike how AI-based decisions are taken.  We have continually invested in embedding Explainable AI and ML capabilities into our banking platform and make available all products through an easy-to-use interface or APIs.  Building on our experience with Explainable AI, Temenos is now harnessing the power of Generative AI as the next step in a strategic AI roadmap, powering the future of banking with ethical, secure, and responsible deployment. We believe that such transparency and explainability will be critical for all AI use cases in banking to help satisfy regulatory requirements.”

Explainable AI software capabilities are embedded in multiple areas within Temenos solutions including Wealth Management such as with our Robo-Advisor, Anti Money Laundry, attrition minimization, Credit Scoring, Customer management, Customer support, Cross-Selling, smart money management, Collections Optimization, Tailored Pricing, and an active ongoing roadmap for enhancing Wealth Robo-Advisor.

By embedding AI and Machine Learning into its products, Temenos has accelerated the release of explainable models that underpin multiple – and growing - AI use cases that focus on creating seamless customer journeys and automating manual processes with self-learning capabilities.

Transaction classification is the first Temenos product to leverage Generative AI and the company is exploring further use cases for the technology, such as in chatbots and customer interfaces as well as guiding customer journeys and triage and routing customer queries.