Toronto-Dominion Bank (TD Bank), one of North America’s largest financial institutions, has leveraged artificial intelligence (AI) to enhance its operational efficiency, customer experiences, and employee productivity. Through a series of innovative pilot projects and ongoing initiatives, TD Bank integrates AI across various areas, including customer service, software development, and financial product approvals. These efforts are spearheaded by Layer 6, TD’s in-house AI research lab, and exemplify the bank’s commitment to technological advancement.
The foundation of TD Bank’s AI strategy is to augment human roles rather than replace them, making jobs more productive and engaging while ensuring speed and accuracy in processes. By streamlining workflows, TD aims to enhance operational efficiency in both customer-facing and back-office functions. A key differentiator for the bank is its reliance on in-house expertise from Layer 6, which has grown significantly since its acquisition in 2018. The bank also prioritizes security and compliance in all AI implementations, ensuring the technology adheres to regulatory requirements while delivering tangible value to both customers and employees.
TD Bank has deployed AI in several high-impact areas. Its AI-powered mortgage and term-life insurance approval systems, launched in 2023, are trained on historical application data and underwriting practices to deliver decisions for simple applications within seconds. A generative AI virtual assistant has been introduced to assist customer service agents by providing accurate and conversational responses to their inquiries. Piloted in 2024, the assistant directly quotes policies and procedures, enabling agents to confidently provide accurate answers to customers.
Additionally, TD engineers have begun using Microsoft’s GitHub Copilot to streamline software development. Piloted between September and December 2023, the tool analyzes code, suggests improvements, and helps catch bugs faster, significantly improving productivity. These initiatives are driven by Layer 6, which has expanded from 15 employees to over 200 since 2018, underscoring TD’s investment in AI expertise.
The implementation of AI has yielded significant results for TD Bank. The mortgage and insurance approval systems have processed thousands of applications within seconds, reducing stress for customers and freeing underwriters to focus on complex cases. Among engineers using GitHub Copilot, 93% reported equal or greater productivity, with 50% saving up to 20 hours in a two-week sprint. The generative AI virtual assistant has reduced response times for customer service agents and increased their confidence in handling complex queries. The bank’s commitment to innovation is further reflected in the growth of its AI-related patents, which have increased by 110% since 2020, with 20% tied directly to AI.
TD Bank faced several challenges in its AI journey. Ensuring the accuracy of AI systems was critical, particularly in a heavily regulated industry where compliance is paramount. Integrating AI into established workflows required careful planning and extensive training to ensure employees could effectively use the new tools. Balancing resources for AI initiatives with other critical business needs was another hurdle, as was navigating the technical limitations of generative AI tools, which occasionally deferred to human expertise when they could not confidently resolve complex queries.
Looking ahead, TD Bank plans to expand its AI applications across retail banking, investing, and insurance. Potential future use cases include delivering more personalized customer experiences, offering data-driven investment insights, and handling more complex underwriting scenarios. The bank also aims to scale AI tools like GitHub Copilot to additional engineering teams, further enhancing productivity.
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