November 30, 2018

Powered by AI, worry-free automated savings eliminates overdraft fears

Overdraft featured


We all want to save more, but we can’t always find extra funds to put away safely. And the last thing we want is to get into overdraft trouble due to an overaggressive automated savings plan.

How to keep automated savings from resulting in an overdraft fee is a legitimate question raised in a recent Bankrate article, and one that often gives people a pause when considering automated transfers:

“…automating savings is something some consumers are wary of trying because they fear they wouldn’t have enough money to cover the transfers.”

Without a doubt, scheduling a recurring money transfer from an account that is actively used to pay bills poses a risk. Even an attentive consumer can get tripped up by an out of sight, out of mind money transfer that depletes their checking account balance just when those funds are needed for a payment. Combined with the rote nature of simple automation that will transfer the funds regardless of any extenuating circumstances, including an overdraft, it is easy to see how the dilemma might appear to many – choose safety or savings.

What this warning from Bankrate actually highlights is the stark difference between simple automation and smart technology. Instead of passive money management solutions that don’t ‘think’ about the consequences of actions, smart technology is a way to introduce active, AI-powered money management into the everyday banking experience in a way that learns, thinks, and acts on behalf of the customer.

In regard to automated savings and overdraft fees, artificial intelligence can not only be utilized to safeguard consumers and businesses from incurring such penalties, but it can also serve to simplify banking and reduce the stress commonly associated with it.

Self-Driving Finance™ alleviates the anxiety of incurring overdraft fees due to automated savings transactions because the possibility of an actual default is, for all intents and purposes, eliminated.  Forward looking cash flow predictions, based on the analysis of aggregated account data, enable the platform to determine not only how much money is available to transfer but also when it is safe to do so to ensure that funds are available to cover future expenses.  Moreover, this same data-driven intelligent awareness can also realize when a potential overdraft looms and suggest the necessary action to avoid it.

To borrow from the world of self-driving cars, it’s like the difference between the simple old automated cruise control which can crash you into the car ahead if it slows down, versus the smarter version of adaptive cruise control which will automatically slow you down to keep a safe distance.

Even though “We all have really busy, complicated lives where we are trying to remember and juggle a ton of things,” as Common Cents Lab’s Andrea Dinneen pointed out to Bankrate, managing a bank balance does not need to be one of them when smart technology is working for you.

The bottom line is that there is nothing to fear about automated savings if it is done in a smart way. Utilizing the power of AI, personalized and predictive automated savings can help customers maximize savings while reducing anxiety over unintentional overdrafts.

To learn more, click here to see How Banks Use AI to Improve Customers’ Financial Lives.


Related links:

RBC wins Model Bank Award for Personal Financial Experience

Self-Driving Finance™: Transform Banking from Transactional to Purposeful

Proactive Money Management: AI Power Gives PFM a Second Life