Artificial intelligence in financial services has the potential to disrupt several key business processes. Its ability to process a large amount of data and produce accurate results has found a lot of uses in the finance sector. Thanks to the rapid digitization of everything around us, banks and other financial institutions are quickly warming up to the benefits of having artificial intelligence (AI) in their workflow. To know more about how AI will impact different financial services, read on.
Impact of Artificial Intelligence on Financial Services, like:
AI is changing the way banks assess the application of a potential borrower. It uses a complex approach to analyze the applicant’s credit score, past payment habits, active loans, and more. It helps banks to identify if an applicant is high-risk or safe based on all the data at hand. This also allows banks to have a flexible interest rate and loan repayment scheme that makes more sense for the borrower.
Finance can be a tricky subject for most people. They struggle to track personal income, recurring expenses, and while calculating taxes, interest on active loans, figuring out efficient mortgage premiums, and other complicated processes. With the help of mobile banking solutions and AI-driven chatbots, banks can resolve some of these queries for their customers and provide them with peace of mind through regular updates on interest rate changes, reminders for the next payment, bank balance, and more.
Fraud Detection and Management
Artificial Intelligence in financial services has improved fraud detection and management to a great extent. While it can take someone hours to figure out an anomaly in a person’s spending behavior, AI can do it in an instant. This not only protects banks from getting cheated by their customers but also prevents customers from getting scammed or duped. Through machine learning, banks can detect potential frauds based on past trends as well.
Manual processes like data entry, credit card applications, new account setup, and withdrawals or deposits can take up thousands of work hours for the bank. Automating these processes will not only save time but also help in reducing expenses and errors. With the help of integrated AI, users can complete several of these processes on their own without the need for any bank official to get involved. Several leading banks have already begun using AI and robotic process automation to save money.
While the decision to invest in something will forever lie with a human being, AI can help make that decision easier based on data-driven analysis. AI-driven trading systems can process structured and unstructured data quickly to provide an accurate prediction of what’s going to happen next. They can also help in creating a strong portfolio of options based on past trading behavior, and the short-term and long-term goals of the investor.
The rise in mobile banking, online trading, and FinTech companies has accelerated the adoption of artificial intelligence in financial services. With its help, banks are not only processing applications faster, reducing fraudulent activities, and eliminating manual errors, but also realizing growth in revenue and cutting back on expenses. For more AI related articles you can check Knowtechmag.com.