PurposeAs artificial intelligence (AI) continues to make inroads into several industries, it has taken over tasks previously performed by humans. However, given that individuals frequently have their self-esteem, identity and feelings of self-worth wrapped up in financial matters, will there be a difference in their satisfaction when their credit applications are processed and approved through AI versus humans?Design/methodology/approachThis work uses five studies, including a field study, three online experiments and one laboratory study, to underline the difference in customer satisfaction when credit application processing occurs via AI versus humans.FindingsThe authors find that customers are more satisfied when credit application processing is performed through an AI algorithm rather than by humans. This effect is explained by reduced embarrassment. Furthermore, the authors show that for emotionally intelligent individuals, credit application processing through humans will mitigate the impact of embarrassment, leading to higher customer satisfaction. Finally, the authors identify an individual's relationship with the financial organisation as the boundary condition stating that for first-time customers (vs continuous customers), credit application processing through humans causes less embarrassment.Research limitations/implicationsThis research makes significant contributions in the realm of consumer psychology and credit application processing. First, it advances the existing literature on AI versus human interactions by investigating their comparative impact on customer satisfaction within financial processes such as credit approval. In addition, it identifies credit application processing (whether by AI or humans) as an unexplored antecedent of embarrassment. Moreover, this study enhances the body of work on emotional intelligence by demonstrating its role as a coping mechanism for dealing with embarrassment. Finally, it uncovers a novel driver of embarrassment: the nature of individuals' relationships with financial organisations, differentiating between continuous customers and first-time applicants.Practical implicationsThis study suggests deploying AI for credit approval and adopting strategies to reduce customer embarrassment to boost consumer satisfaction. In addition, managers should consider customers' emotional intelligence levels and use humans for first-time credit applications to minimise embarrassment.Originality/valueArguably, to the best of the authors' knowledge, this study is the first to identify AI versus human processing as a novel factor influencing customer embarrassment in financial service satisfaction. It also provides a new aspect of emotional intelligence as a coping mechanism for embarrassment. Furthermore, it uncovers a unique driver of embarrassment: the nature of individuals' relationships with financial organisations, distinguishing between continuous customers and first-time applicants.
