In testing its artificial intelligence-powered tool Coach, SoFi got a lesson in how to best present responses to resonate with humans.
“When it comes to financial guidance and coaching, there's both an art and a science to it,” said Brian Walsh, head of advice and planning at the digital bank.
While the science is straightforward – spend less money than you make and pay down debt, for example – “it's the art of how things are positioned and how trade-offs are made, and how you actually get people to realize things and take action,” he said.
“One of the biggest learning experiences along the way,” he said, “was how do we take this and communicate this in the best manner possible?”
Walsh pointed to debt paydown as an example. From a mathematical standpoint, the avalanche approach – which involves paying down the highest interest rate debt first before moving down the list – is best, he said.
But “in reality, the snowball approach ends up being much more effective for an overwhelming majority of people, because it plays to human behavior, where they see progress quicker,” he said, referring to the method where you pay off balances from smallest to largest.
That inspired $53.7 billion-asset SoFi to train Coach on how to best position its advice and guidance, reframing it to provide the answers that will resonate with customers, he said. The company’s financial planners were also involved in evaluating Coach’s responses.
The idea was, “here's what the math and the science say, but here's how humans actually behave, so let's position it this way, so that way, they're more likely to take positive action in their lives,” Walsh said.
Coach is an AI-powered, chat-based financial guide within the SoFi app, tapping customers’ data to deliver personal financial insights. Coach is being rolled out to SoFi Plus members this month and the company will expand access to it over time, Walsh said. San Francisco-based SoFi has about 14.7 million customers.
Coach builds on Relay, a financial management tool the company launched in 2019 to connect customers’ external accounts and give them better visibility into their various financial commitments.
The bank has been developing and testing generative AI-powered experiences over the past several quarters. Coach can help customers track spending and saving, budget and invest. Down the road, SoFi plans to add features such as subscription management.
During testing, members indicated they’re “pretty comfortable with this type of experience,” Walsh said. A majority took action to improve their financial situation after engaging with Coach, which signals a deeper level of trust, he said.
Over time, SoFi may arm Coach with more autonomous capabilities, Walsh said, noting that some people want to automate as much as they can, while others don’t. It’s about “figuring out the right balancing act between people wanting to have control and have their hands on the steering wheel, while also making their life easier,” he said.
Internally and externally, the company has been asked if Coach will replace humans. Walsh said he views it as “a complement,” with technology being used to scale and enhance employee productivity.
He said SoFi hasn’t cut any financial planner employees and doesn’t plan to. The bank has about a dozen financial planners.
The demand SoFi has experienced over the past several years for financial planner services, and that customers who work with those employees report high satisfaction, inspired the thought process behind Coach, Walsh said.
“People want to understand where they stand and what they can do to improve their financial lives,” he said. “How do we then scale that? And can we scale that through technology?”
As AI-powered virtual assistants proliferate among bigger banks and fintechs, Walsh said SoFi’s is differentiated partly because the company holds a national bank charter, which bolsters trust. So, too, does the fact that Coach was built on the foundation of SoFi’s financial planning team working with customers one-on-one for several years, he contended.
Coach’s insights and ability to drive action to help customers improve finances also helps it stand out from digital money management tools out there, Walsh said.
For some customers, the awareness of their financial picture is enough, while others want to understand what they could be doing with their money and why it would be the best move, he said.
That’s a missing piece amid a push to arm more consumers with access to financial products for the ultra-wealthy, Walsh said. “Without the guidance to make use of those products and make the best decisions for their lives, I don’t necessarily know if those are that powerful,” he said.
