Artificial intelligence is steering the fintech industry towards a future of efficient financial management and real-time data analysis. AI is constantly evolving as we speak and come 2030, AI technology will cut down banks’ operational costs by 22%.
As society breaks through with technological advancement and computing solutions, the financial sector is set to witness the true potential of artificial intelligence. The race for increased productivity and automated processes has financial institutions across the globe investing in various AI fintech solutions, from digital payments and virtual advisors, to wealth management. By 2026, the AI-powered fintech industry is predicted to generate US$26.67 billion with a compound annual growth rate (CAGR) of 23.17%.
The Benefits of AI in Banking
In the United States alone, fintech services saw an increase in daily usage: from 37% in 2020 to 48% in 2021. Today’s mobile banking and digital banks are paving the way for a more optimized and secure banking experience.
Artificial intelligence and machine learning are indispensable tools for database management and analysis. Where the human agent fails to perform efficiently, AI can provide valuable insights in real time. The financial industry is ripe with opportunities to optimize workflow, and AI offers a range of solutions for smoother and hassle-free operations.
1. Operational Cost Reduction
Running an automated analysis on customer accounts, financial trends, and the like offers a boost in productivity. AI delivers cutting-edge support in automating mundane processes, which allows banks to redistribute resources and upskill their human workforce. The technology performs tirelessly, cross-checking incoming data with past records to deliver actionable advice.
2. Predictive Analytics
Artificial intelligence equips companies with the right toolkit for customer retention. By analyzing a customer’s previous performance, institutions can offer personalized solutions to extend customer lifetime value. Not to mention, upselling new product offers to the intended audience leads to successful sales.
3. Credit Scoring
Lenders require a broad data analysis of a borrower’s creditworthiness. AI delivers a comprehensive review of the borrower’s profile and risk assessment in no time. Rather than simply relying on primary data sources, artificial intelligence refers to multiple data sources available to offer loans and affordable credit scores to a more inclusive audience.
4. Fraud Detection
The United Nations reports that the amount of money laundered on an annual basis is two to five percent of the global Gross Domestic Product (GDP). With a substantial amount of US$800 billion to US$2 trillion transacted illegally, tightened security is crucial. AI-powered security platforms can notify institutions of fraudulent activity right off the bat.
5. Chatbots for Customer Support
Chatbots are a popular AI application in customer service. 67% of the fintech industry’s customers reported that they rely on chatbots to resolve their concerns. This nifty solution allows companies to cut back on workload and keep an open communication channel 24 hours a day.
Make AI-Driven Decisions Today
The growing competition in mobile banking and virtual banks propels the development of artificial intelligence in the fintech industry. Optimize your databases and workflow with AI-powered solutions. Harness the power of smart data with BBI.