How Artificial Intelligence is Revolutionizing the Financial Services Industry

July 13, 2021
Sarah Gormley

Fintech is on an innovative spree, revolutionizing the financial services industry. One of the technologies that have played a role in this innovation is Artificial Intelligence. 

Artificial Intelligence (AI) is the stimulation of human intelligence by computer systems. Financial service providers are after AI to help automate their processes. The benefit of implementing AI for task automation has the potential to save financial institutions billions of dollars in the next couple of years. To be specific, Business Insider Intelligence predicts that by 2023, the potential cost savings for banks from AI implementation is estimated to be $447 billion. 

AI algorithms are being implemented all over the world, in all sectors of financial services due to the amazing results companies are seeing already. AI benefits financial service companies in many ways including detecting fraud, accurate decision making, and automated customer support.

 

Detecting Fraud

AI is becoming a more popular way for financial service companies to detect fraud. To prevent institutions from losing billions of dollars over identity fraud, AI algorithms are set to identify suspicious activity, monitor users’ behavioral patterns, and analyze data at the moment. This process makes verifying and authenticating users’ information fast and efficient.

 

Accurate Decision Making

Before financial technology began to play a role in the finance industry, institutions would have to meet in person with customers and develop a personal connection to understand their needs, helping make the best decision. AI makes this easier by quickly analyzing masses of data to find important information about the customer. It can be used to find and recognize patterns that can lead to more accurate decision-making when finding the best options for the customer.

 

Automated Customer Support

Companies can use AI to gain real-time insights when in contact with customers. The most common AI software program in the fintech industry in terms of customer support is chatbots. These AI bots are set to start conversations with customers, providing helpful information to them. With 24/7 customer service and preset responses, chatbots prevent customers from getting agitated by having to wait for a human to respond from the other end of the line. 

 

Artificial Intelligence is not only disrupting the financial services industry but many others as well. Some of the other industries AI is disrupting include healthcare, retail, logistics and transportation, real estate, and entertainment. With AI having been around since the 1950s and just now gaining all this popularity, there is a lot of hope for the future.

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