Nordea’s digital savings adviser Nora shows promising results

Maria Nikolova

Nordea says 70% of its customers in Sweden who started to save through Nora have not previously saved with the bank.

When Nordea Bank AB (STO:NDA-SEK) first announced its plans to launch a web-based robot advisor last year, the announcement was overshadowed by the news that the digital transformation of the bank will involve significant job cuts. Casper von Koskull, President and Group CEO, said back then it was time to enter the next phase of the transformation, involving bringing down costs and increasing efficiency.

“This transformation requires a shift in competence among our employees. Additionally, in order to secure long-term competitiveness, we also plan to reduce the number of employees and consultants with at least 6,000 of which approximately 2,000 are consultants”, Casper von Koskull said.

But the digitalization of Nordea’s business apparently has a bright side too. It does show good results. Earlier today, the bank posted its financial report for the first quarter of 2018, with Nordea’s CEO updating on the new technology adoption at the bank. He noted that the bank launched its digital savings adviser Nora that provides customers with digital savings advice 24/7. In terms of numbers, he said that 70% of the customers in Sweden who started to save through Nora have not previously saved with Nordea.

So, it appears that the artificial intelligence (AI) push of Nordea does deliver.

Nordea is not the single bank to bet heavily on AI for servicing its customers. In a speech given on Tuesday, April 24, 2018, Herman Gref – CEO and Chairman of the Executive Board of Sberbank, said that 98% of the Sberbank decisions for extending loans to individuals and 30% of the decisions for providing loans to business entities are taken by AI.

This, of course, raises concerns about job losses at the Russian bank too. Let’s recall that in June 2017, Mr Gref said the number of employees in back office roles at the bank will be reduced 12 times by 2021, with the use of robots being one of the factors for the jobs trimming.

In its report for the first quarter of 2018, Nordea underlined other aspects of its commitment to new technology development. Nordea has joined the consortium as founding partner. The consortium is, in conjunction with IBM, developing a platform based on distributed ledger technology (DLT) that aims at making domestic and cross-border commerce easier, safer and more efficient for companies.

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