Digital disruption has redefined industries and is changing the way businesses operate. The FinTech sector is embracing new ways of creating value hand in hand with technology and is witnessing revolutionary shifts towards increased customer-centricity. But it is possible to see several uses of AI in financial services. Jason Simon, a specialist in FinTech, explains how this sector relates to AI.
Customers constantly exposed to advanced technologies in their daily lives now expect FinTech to deliver more than satisfying experiences. Artificial intelligence (AI) is changing the way we live. We used to think that machines and software were a long way from being able to execute actions and solve problems.
AI and its applications have had a significant impact on almost every industry, as well as FinTech. Defined as a technique that allows machines to mimic human behavior, brands are using AI to automate processes at an increasing rate. For example, in interaction through site suggestions in our search engine or application troubleshooting.
AI is not a new phenomenon. It has been around for almost half a century, constantly evolving, almost daily. As we become more efficient and AI learns to better emulate human intelligence, companies benefit from the increased process and operational efficiency.
As an example of the above, an analysis by Simon predicts that AI could contribute as much as $15.7 trillion to the global economy by 2030. Of this, $6.6 trillion is likely to come from productivity gains and $9.1 trillion from consumption spillovers.
“There is a growing awareness globally around how artificial intelligence can provide optimal results while working in tandem with humans,” Simon notes. “This essentially means humans and AI augmenting each other’s unique capabilities, such as the innately human qualities of leadership: emotion, compassion, teamwork and creativity; and speed, scalability and other quantitative capabilities of this technology.”
There is an extensive list of AI uses cases in different industries. Integration of AI in FinTech sectors processes and functions could be very beneficial. It has the potential for reducing costs, increasing productivity, and contributing to customer service practices.
As AI becomes further interwoven into the FinTech discourse, we have witnessed the emergence of a few key trends. First, these organizations are using AI and machine learning to measure risks and assess fraud cases. These tools learn and trace user behavior, looking for patterns that can be used to identify potential scam attempts.
Simon adds, “AI systems are able to learn from and adapt to new cases, and improve their scam detection and risk detection capabilities to protect customers. This technology is also being increasingly used to manage customer relationships.”
FinTechs also make use of customer-facing systems like chatbots and voice assistants that can provide human-like interaction with customers to resolve problems at a fraction the cost. Users can then make payments or transactions using chatbots without having to download apps or have to interact with humans.
People are increasingly looking for fast, personalized experiences, which can be delivered by AI-based virtual assistants. These can even give data-backed financial suggestions by leveraging their mining and analytics capabilities.
“FinTechs can use AI for more personalized strategy, leveraging anonymous and non-identifiable user behavioral data to tailor relevant campaigns and offers,” suggests Simon.
This technology can also help with customer retention and loyalty. It can take into account a consumer’s information to ensure brands are offering the most appropriate products at the right time. This allows companies to improve their services and offers, thus aiding user loyalty.
This technology is enabling organizations to transform regardless of their vertical, and it is taking on more complex tasks. This bodes well for the entire industry, but it is important to view AI not only as AI, but also as augmented intelligence.