By Sneha Das
Just like the other industries, technological disruption has affected the financial sectors too. This fusion of technology and the financial sector is called “Fintech” and has now become a mainstream term. The rising penetration of internet users has brought a storm in the market. There is a rapid shift to mobile devices for transactions or related action.
According to Mordor Intelligence, the estimated share of AI in the fintech market was USD 7.27 billion in 2019 and expected to reach USD 35.40 billion by 2025. The CAGR of 31.5% can be witnessed during the forecast period 2020 to 2025. The major players of this financial tech arena are IBM Corporation, Intel Corporation, Microsoft Corporation, IPsoft Inc. and Next IT Corp.
“The last 10 years have been about building a world that is mobile-first. In the next 10 years, we will shift to a world that is AI-first.” -Sundar Pichai
Now, know the best AI trends 2020 roaring in fintech industries:
- End of manual underwriting and the rise of ‘just-in-time’ lending paradigm.
The future fintech industries will revolve around AI that automates the financial lives of customers and improves the financial results. AI can perform real-time analysis and make smart decisions. It will trigger the just-in-time lending model, and the customers will be given the best insurance policies at the lowest prices. Whereas the underwriters, lenders, money managers in any industry are at risk if it contains the crunching numbers to estimate a return.
- Emergence of Fintech Cloud and Infrastructure (BaaS/IaaS)
A real BaaS platform- managed service for the developers and data scientists to create and run excellent machine learning models on the production. It enables them to develop their financial products together with a fintech cloud-like ML cloud. Even, it would be the next step in the fintech infrastructure evolution.
Reduced Financial Crime, NLP and Compliance Automation
The risk and compliance function suffers from the massive data load and exhaustive regulative demands. With NLP (Natural Language Processing) in fintech can help in understanding the Govt. regulations and create-sensitive policy tests. This policy test refers to an unambiguous set of the do and can’t do lists that every fintech have to follow in the jurisdiction.
Network analytics determine the connections between individuals in to evaluate the risky networks and parties. This leads to a reduction in financial crime due to increased transparency and liquidity that makes easier anomaly detection.
4. Platform shift and Voice-First Fintechs
Voice search is the ultimate need of every industry so how can fintech be left? As we know, voice is a default UI and there are huge benefits of voice-first fintech. Let’s see how: On-demand micro-credit — “Alexa, can I borrow $500 from Mr.A?”
Transactions- “PNB, send Manish $200 from my IDFC account.”
Investments — “Alexa, buy $200 of Bitcoin for me.”
We are in the new age of intelligent applications. These are purpose-built, and the contextual signals like hardware, sensors, location, previous usage and predictive computation kept in mind. In short, human-voice will be a primary interface in 2020.
5. AI & customer loyalty’s new battlefield
Personalized payroll, salary-linked offerings and benefits will be the next trend of AI in 2020. Everyone manages their salary differently, and the limited options of the banks don’t solve everyone’s problems. In contrast, AI will ease this process too with the more in-depth analysis of transaction history that results in the customization and contextualization.
6. AI+ Blockchain-The Ultimate Future
Both blockchain and AI include technical complexity, and their joint use can advance and improve the business models significantly. Blockchain’s immutable data doesn’t require any centralized verification, that could be vital for identity management.
AI will enable the execution of complex and automated smart contracts, allowing the more blockchain use-cases to join the mainstream. Some of these applications would be Collective AI Investment Management Platforms and AI Marketplaces.
7. No payment intermediaries
With the ubiquitous transformation payment platforms, interoperability will be the next norm. The manual process will be automated completely in the payment process. In this transformation, interoperability will be the next norm. The manual process will be entirely automated in the payment process.
The advanced and intelligent machine will know-your-customer procedures, perform onboarding, run payment backends, scan millions of transactions as well as sales plus marketing. In the coming years, AI will be a central driver of the payment instance in the first instance.
8. Collaborative AI and collective solutions for shared problems:
The collaborative solutions developed on shared datasets will radically increase the accuracy, non-competitive functions, timeliness, creating mutual efficiencies in the operations and enhancing the safety of the financial system.
How AI aids fintech industries?
The financial industries were the early adopters of computer technology and have eagerly awaited for the next level advancements. If we talk about AI, then it applies the advanced methods derived from Human Intelligence to improve the results. You might be amazed to know that the computational arms are revolutionizing these industries from the last two decades. Below, we have mentioned the significant offerings of AI in fintech companies.
Accurate Decision Making
The data-driven decisions at a lower cost form a different type of management where human dependency have supplanted the machines. It comes up with better results and helps the industries to the financial agents and their subordinates to make better and right decisions.
Automated Virtual Financial Assistants
Automated financial assistants help in monitoring events, stock & bond price trends and more to make financial decisions. They are often called “Robo Advisors” and used in both the established as well as startup Fintech companies.
Automated Customer Support
Delivers expert plus human-like customer service via text chats or chatbots and that too at a lower cost. Here, chatbots act as your ‘Personal Finance Assistant’.
Another vivid example of AI technology in fintech is predictive analytics. With the prompt capturing, processing and analysis of the vast data sets allows the business to predict future trends better. That’s why traditional analytics tools have been replaced with machine learning algorithms for better data analyzation, risk predictions and opportunity identification.
It’s vital to learn that AI capabilities are intertwined with the development of all the other tech innovations. The emerging technologies are mutually strengthening, and the advancement in one technology indirectly boosts the skills of the technologies from which it interacts. To make the best use of these technologies in your businesses or rela-life industry you can hire indian developers for AI and other technologies who are not only provides the best advice but also develops through latest trends at the lowest costs.
So, all these top AI trends will rule the fintech in 2020 as well as the coming years.