Artificial Intelligence in Fintech

Posted on June 27th, 2022

The future of technology, artificial intelligence has been in the limelight for a few years now. What started as a mere concept, is living and thriving in the world today. The majority of us have had the opportunity to witness and experience this extraordinary creation by humans that has disrupted the functioning of more than one sector. 

Artificial intelligence involves the creation of technologies by simulating human intelligence to retrace human actions and behaviors to be used with technology. Creating machines that mimic human traits and trends for learning, analyzing, and problem-solving makes up the majority of artificial intelligence.

AI Role in Fintech

The fintech industry is dynamic, changing and disrupting services, products, and the entire financial structure robustly. The evolution of fintech is based on the amalgamation of customer requirements, competition, and most importantly, the scope of technology. 

The role of artificial intelligence has vigorously gained importance owing to the usefulness of this technology in serving humans. The biggest areas that have been impacted by fintech are:

Security

The level of security that AI brings to the fintech table is remarkable. Small changes such as using biometrics like facial recognition to open banking apps, to bigger changes like detecting fraudulent activities by studying customer trends and behaviors, have become possible because of the involvement of artificial intelligence. 

Automation

 Data analytics, machine learning, and automation of processes became pillars of artificial intelligence. By increasing automation and minimizing human involvement in everyday processes, the margin of error can be reduced. 

Customer Service

One of the major areas that have undergone monumental change because of artificial intelligence is the customer service area. With artificial intelligence in play, the emergence of trouble-shooting chatbots, automated and quick password changes, and various other customer-centric services has become quite prevalent. Checking your bank and credit card statements and the rewards earned from your purchases and investments is one of the primary benefits for most customers. 

Risk Assessment

Another major area that has evolved rapidly is risk assessment. For companies, the risk assessment is carried out on new and potential customers, while for individuals, this assessment is done on their investments to ascertain risks. With AI, studying trends, analyzing data and information to predict future trends, and reading the impact of everyday happenings have become much easier and exhaustive.

The Future of Artificial Intelligence

While AI has been in the limelight for some years now, there is no doubt that AI is here to stay. The scope of opportunities that AI brings is enough to suggest the incredible number of possibilities for the banking and financial sector. According to some reports, the main sectors that are likely to experience an increased corroboration with AI are:

Workforce

Using AI to upskill the workforce is one of the major tenets being focused on in this field. By infusing AI with learning and problem-solving tools, the major sector that stands to gain is the banking workforce.

Automation

An extension of customer-centric services, automation is being keenly eyed as one of the leaders of fintech. Automation of everyday processes like using Chatbots for frequently asked questions would not only enhance customer services but also help reduce the cost of labor.

Personalized Banking

The potential of AI is also being targeted at creating personalized banking apps for customers, which would study customer behavior and trends to offer services that suit the customer. Such steps would help build better and stronger relationships between customers and banks.

Fraud Detection

This is one of the most important areas where AI can have a huge role to play. By getting deeper insights into customer habits and behavior, AI can help detect frauds. If some account-related activity is detected that doesn’t follow a customer-specific trend, it can immediately be identified as an outlier and can eventually help detect fraud.

Final Notes

AI, which started as a concept has revolutionized the entire spectrum of fintech. Owing to its remarkable adaptability and scope, AI can be used for various purposes like problem-solving, fraud detection, risk assessment, and more. Fintech companies nowadays use AI to offer customer-centric services, enhanced efficiencies, and quick responses. The scope of innovation in AI is so vast, that it leaves no doubts that the future of AI remains bright.

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