Citigroup chief executive Mike Corbat has suggested that “tens of thousands” of people working in the US bank’s call centres are likely to be replaced by machines that can “radically change or improve” customers’ experience while cutting costs.
Mr Corbat, who runs America’s fourth-largest bank by assets, made the comments in an interview with the Financial Times in which he also ruled out Citi’s involvement in any wave of US banking consolidation triggered by the $66bn SunTrust-BB&T merger and justified its continued presence in China.
Under pressure to bring its cost base in line with peers, Citi executives have been upfront about the impact of technology on their 209,000-strong global workforce, including last summer’s warning that as many as half of the 20,000 operations staff in its investment bank could be supplanted by machines.
Mr Corbat’s latest comments are the most explicit the company has been on how the $8bn a year Citi spends on technology could transform its vast consumer bank, which serves 100m customers across 19 markets.
“When you think of data, AI [artificial intelligence], raw digitisation of changing processes, we still have tens of thousands of people in call centres, and we know when we can digitise those processes we not only radically change or improve the customer experience, it costs less to provide,” he said.
He would not specify how many people Citi employed in call centre jobs or how many would be affected, but said that the “30 most common customer journeys”, such as ordering replacement bank cards and asking about statements, were “pretty easy to deal with”.
Other companies are already using AI in call centres — UK retailer Marks and Spencer has systems that can analyse voice commands in real time and direct queries to the right department, while Google is also developing software that uses open-ended questions to find the best answers for customers and cut waiting times.
Citi has no plans to get rid of humans in its call centres altogether though. “There’ll always be the kind of thing where you’ve actually got to have someone to help solve,” said Mr Corbat. “We don’t want people frustrated in that.”
Mr Corbat cited the potential of Citi’s technology as one of the reasons that his bank would not take part in the wave of US retail banking mergers that some analysts expect to be kicked off after BB&T and SunTrust unveiled the sector’s biggest post-crisis merger a fortnight ago.
SunTrust and BB&T’s merger was “predominantly driven by the need for scale around the ability to invest in and implement technology”, said Mr Corbat. “We have that scale . . . We’re comfortable with the markets we operate in, we’re comfortable with our client base . . . That very quickly leads you back to a conversation about organic growth.”
In the era of Trumpian trade wars, criticism including activist investor ValueAct, have questioned Citi’s geographic spread and its exposure to Mexico, where it owns the country’s second-largest bank. Citi is also the most prominent of the US banks in China.
“China needs soy, China needs beef, China needs pork, Chinese needs import of raw materials into their supply chain,” said Mr Corbat. “Those routes may change. So as we [in the US] get tariffs and embargoes and things, those soy routes may move from the US to Brazil and Argentina — two places where we operate. We’ve seen a redrawing of these trade routes, but the demand hasn’t gone away.”
He added that Citi remained the best owner for Citibanamex in Mexico because “if you look at the pace of digital adoption and the expectation of consumer clients, the technology we’re already using in Asia and the US is totally portable to Mexico today”.
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