Indian financial services company Bajaj Finance has set ambitious growth goals under its BFL 3.0 initiative. The company aims to become an early adopter of emerging technologies such as artificial intelligence (AI) to drive growth and reduce costs. Bajaj Finserv currently has over 300 projects across its companies focused on leveraging Generative AI (GenAI), as shared during its 'Investor Day' presentation to analysts and investors at the Group meeting in Mumbai on December 10, 2024.
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"We believe that financial services in India is increasingly getting digital, it is leveraging data. And those companies that can manage the right balance between people and digital, between growth and risk, between innovation and responsibility, are the ones that have a greater chance in reaching out to customers in what is otherwise a very commoditised industry," said Sanjiv Bajaj, Chairman and Managing Director of Bajaj Finserv Limited, the holding company for the financial services businesses of the Bajaj Group.
Sanjiv highlighted the success of GenAI, stating, "You can see with Gen AI over 300 projects. On one of those projects we have a Gen AI voice-enabled tool, which you can't believe is not a human that is talking and selling on average 10,000 loans a month for the last year." He emphasised that many of the company's projects are operational and not just in pilot stages.
"We also believe that Gen AI by bringing in natural language into programming will enable a larger, larger number of Indians to get trained for these services. As a country, we have to make sure we create job opportunities for them. Because now the training is getting even simpler again.," Sanjiv added.
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Insurance and AI Integration
Bajaj Allianz General Insurance Company claimed to be the first large insurer to transition its core systems to the cloud. Its AI-driven voice bot currently serves over 1 lakh active users. The company is leveraging GenAI alongside traditional AI and automation to drive digital transformation. Partnerships with key Large Language Model (LLM) players like Microsoft, Anthropic, and Google are enabling live use cases, with several others in the pipeline, the presentation said.
Bajaj Allianz highlighted its Basic GPT Workbench, a platform enabling employees to experiment with LLMs and implement standalone use cases. Another highlight is "Insurance Samjho," an AI-enabled tool that simplifies insurance for customers by providing instant, easy-to-understand answers to uploaded policy queries. Another project, "Ask Us," serves as a GenAI-powered assistant for employee queries.
AI has significantly enhanced customer interaction at Bajaj Allianz. Currently, 76 percent of digital customer care is handled by AI-enabled BOT, with 4.5 crore bot messages exchanged and 2.39 lakh calls handled by voice BOT.
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Bajaj Allianz Life Insurance
And then, the presentation is followed by Bajaj Allianz Life Insurance, which claims to be India's only agency channel that is 100 percent digital, with a network of nearly 1.6 lakh agents.
Tarun Chug, MD and CEO of Bajaj Allianz Life Insurance, noted the potential of AI in life insurance. "Customers provide about 120 to 130 data points when filling forms. This data can help address not only individual needs but household needs as well, enabling upselling opportunities," he explained.
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Innovations in GenAI and Digital Services
Bajaj Allianz Life Insurance Company (BALIC) has also developed a GenAI-powered Smart Pitch platform, which generates tailored sales pitches by analysing customers' unique preferences and personas. This tool has been used by 2,000 top distributors who have transcribed their sales pitches into the system. Additionally, BALIC's NLP-based WhatsApp service has served over 14 lakh customers, streamlining digital services.
Chug highlighted the company's advanced AI capabilities, stating, "We have possibly the only AI brain in the sector. I can maybe even call out in the world which is 97 percent correct on all utterances that it hears in a sector which is very difficult. And this is driven on WhatsApp."
He noted that the engine also won the Insurer Innovation Award 2023 at the World Digital Insurance Awards for the APAC region. He further shared that this marks the first time India has won this Global award.
"So today, whether it's our employee who wants any answers on its own on Provident fund statements or on incentives on anything that he or she would want answered on gold sheets, on leave, etc, can be done through the WhatsApp engine. Similarly, this is for the advisor. An advisor can see where he or she stands. It is there for the customer where there are 56 services for the customer," Tarun Chug further shared.
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Bajaj Finance's Vision for BFL 3.0
Rajeev Jain, MD of Bajaj Finance, emphasised the company's pivot toward becoming a fintech and AI powerhouse as part of its Long-Range Strategy (LRS).
"BFL is currently implementing 29 GenAI use cases across 25 work streams, which will deliver an annual cost save of Rs 150 crore in FY26 alone. But more importantly, GenAI adoption has helped us build a much clearer strategic roadmap," Bajaj Finance said in its presentation to investors.
"Megatrends are principally powerful transformative forces that could change the economy, business and society. They are structural shifts and that are longer term in nature and generally have in general irreversible consequences for businesses," Rajeev Jain, noted, adding, "We think GenAI has transitioned to AI and is a Mega-Megatrend."
"We are transitioning from technology and AI data first to technology and AI first. We're principally saying that over the next 24 months, we want to be a firm which is to use technology and AI first as organisation culture to solve all problems," Jain elaborated.
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"Technology and AI-first as an organisation culture to solve all problems. Be an early adopter and invest in emerging technologies and data practices. It should result in sustained growth, lower costs, improved productivity, superior customer experience and robust controllership," Bajaj Finance said in its presentation to investors.
"BFL will be A FinAI company with AI-enabled technology architecture, which integrates AI across all its processes to significantly improve customer engagement, grow revenue, reduce Opex, reduce credit costs, enhance productivity and strengthen controllership," the company shared in its presentation.
Under BFL 3.0, the company aims to transform into A FinAI company, leveraging AI to enhance customer engagement, grow revenue, reduce operational costs, minimise credit risks, improve productivity, and strengthen internal controls. Jain outlined specific applications of AI, including conversational AI for sales and cross-selling, AI-driven engagement tools, and AI-enabled underwriting and training systems.
"If AI did not solve for revenue, USD 200 billion of investments that the big tech has made will be of no value because and big tech customers are principally enterprises I think. So you will see AI for revenue, AI to reduce cost, AI for design, AI for risk, AI for credit, AI for productivity and AI for controllership," Rajeev Jain explained, adding, "There's nothing that is left that will not touch AI as far as we are concerned over the next 12 to 24 months."
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Millions of SMS sent to Users
Bajaj Finance sends 560 million SMS messages each month. According to the company, all of this is passive communication, and they plan to leverage AI to develop more engaging conversations with customers. "Imagine the power that will unleash on those 560 million SMS as we foresee a 3x plus conversion rate which means 560 million will go to 180 million or one-third," Jain noted.
Leveraging AI across Domains
Bajaj Finance plans to leverage AI across various domains, including conversational AI for sales and cross-sales, an interactive multi-modal AI assistant, conversational AI for business processes, an underwriting AI co-pilot for image processing, note summarisation, screening, and validation. Additionally, the company aims to implement an AI-enabled loan origination system, AI-powered engagement and training, as well as audit co-pilot and auto-pilot capabilities.
