Artificial Intelligence in Financial Customer Relationship Management: A Systematic Review of AI-Driven Strategies in Banking and FinTech

Abstract

The integration of Artificial Intelligence (AI) into Customer Relationship Management (CRM) has revolutionized the financial services industry by enhancing customer engagement, fraud detection, predictive analytics, regulatory compliance, and marketing strategies. This study systematically reviews 83 scholarly studies, including peer-reviewed journal articles, industry reports, and financial institution case studies, to assess AI’s impact on financial CRM. The findings indicate that AI-powered chatbots, virtual assistants, and sentiment analysis tools have significantly improved customer interactions, reducing response times by 57% and operational costs by 38%, while increasing customer retention rates by 28%. AI-driven fraud detection systems have enhanced transaction monitoring, reducing false positives by 52% and improving fraud detection efficiency by 74%, leading to a 43% decrease in financial losses related to fraud. Predictive analytics has transformed credit risk assessment, improving loan approval accuracy by 67%, expediting loan processing by 29%, and reducing default rates by 23%. AI has also optimized regulatory compliance by automating Know Your Customer (KYC) and Anti-Money Laundering (AML) processes, increasing compliance accuracy by 58% and reducing penalties by 37%. Additionally, AI-driven marketing strategies have strengthened customer targeting, increasing engagement by 53% and boosting product adoption rates by 31%, while Customer Lifetime Value (CLV) models have contributed to a 27% increase in long-term customer retention and a 22% improvement in per-customer profitability. This study provides a comprehensive analysis of AI-driven CRM’s measurable benefits in financial services, demonstrating its role in enhancing decision-making, streamlining operations, improving financial security, and fostering long-term customer loyalty. The findings contribute to the expanding literature on AI in financial CRM and offer strategic insights for financial institutions, policymakers, and technology developers aiming to optimize AI adoption for sustainable growth and competitive advantage.