With plans to expand its B2B business across Europe over the next 18 months, German fintech Fidor Solutions teamed up with Vancouver-based startup Finn AI to embed a virtual assistant in Fidor’s “bank-in-a-box” product.

Banks and non-banks using Fidor Solutions will now be able to provide customers with a chatbot that can guide users through the system, answer questions, provide product recommendations, and improve customer satisfaction and service overall, the companies said in an announcement this week.

Matthias Kröner, founder and CEO of Fidor, told Bank Innovation that this development puts Fidor among the first digital banking service providers to embed a virtual assistant within its technology stack.

“We’re always looking for rule-breaking, innovation-leading, cutting-edge partners like Finn AI to service our B2B partners and B2C customers in the most compelling, technological way,” he said.

Businesses like banks, telecoms and retailers use the Fidor Solutions platform, called fidorOS, to support digital transformation initiatives such as the creation of neo-banks, or digital-only banks, Kröner said. A comprehensive banking license allows Fidor to provide banking-as-a-service capabilities for organizations across Europe — including technology, compliance, risk management, go-to-market strategy and customer service.

Asked what market there is for chatbots and virtual assistants in Europe, Kröner said “we are only in the first steps in the market,” at least on the banking side.

“The first steps are being taken in a very cautious, very slow way, particularly in central Europe,” he said. “Germany is not that super-open when it comes to innovation. We Germans only love innovation in a car, but not outside the car.”

However, Kröner also said he expects the interactions between a customer and his or her account will “absolutely change” over the next 3-5 years, driven by regulation as well as the comfort with technology displayed by younger generations. He said as customer expectations are constantly evolving, it’s now crucial for banks to stay ahead of the digital curve.

Also see: Fidor to Launch Third Digital Bank in Less Than a Year

Jake Tyler, CEO of Finn AI, told Bank Innovation that the chatbot uses pre-integrated conversational AI and natural language understanding to deliver individualized, efficient realtime interactions with users. He said Finn AI’s proprietary platform is designed exclusively for banks.

“One of our primary differentiators in the market is we don’t offer tooling to build conversational assistance, we offer conversational assistance as a product,” he said. “So, that includes a pre-trained language model that includes a number of use cases built around consumer banking and personal finance. Our effort, in this case, was improving that in German.”

Tyler said the platform works “80-90 percent out of the box,” and, from there, the language model is improved by use in the local market. “That’s the work we’ve been doing with Fidor, along with building content and customizing for their specific product space,” he said.

The chatbot, Tyler said, incorporates deep machine learning and natural language processing in order to continually optimize and refine its performance through every customer interaction, eventually providing “a truly personalized experience.” He said the chatbot input is primarily text because text is a more scalable interface than voice, but also because online banking is more popular than mobile banking in Germany (and voice is less compelling for web-based banking).

Currently in pilot, the chatbot is available on online and mobile banking platforms through Fidor. Phase one addresses general customer queries and the fast routing of complex conversations to the appropriate human for response. In phase two, the chatbot will assist with transaction services.

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