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Why Do We Use AI in Financial Services?

The advantages of AI in financial services are becoming so undeniable that few actors still decide to ignore them. Here is what you need to know.

The rise of fintech services indicates that more and more people are becoming aware of their introduction in the sector. Yet, it sometimes remains unclear exactly what is implied by the adoption of AI in financial services, be it from the perspective of what Artificial Intelligence actually is in this context or in terms of what it can do.

From assisted parking to robotic surgery, we have begun to rely on Artificial Intelligence even in circumstances where lives are at stake. As far as financial services are concerned, AI provides a breath of fresh air in a traditionally conservative business landscape.

Yet, as consumers come to expect modern functionalities that harness the full potential of the technologies at their disposal, those who have learned to integrate AI in financial services appeal to a greater and greater proportion of the population.

Let us see how integral AI truly is in the finance industry and what its main applications are

AI in Risk Management and Fraud Prevention

Capable of analyzing vast amounts of real-time information, cognitive computing systems can gather and interpret both structured and unstructured data and provide advice based on the history of risk cases. Because relevant signs are identified early on, future issues can be proactively circumvented. Such experts as Dreamquark, for instance, offer easy-to-implement solutions which allow non-specialists to decipher the AI’s decisions.

As far as fraud prevention is concerned, AI in financial services serves in a similar capacity. In the case of credit card fraud, for example, Artificial Intelligence is able to analyze client behavior, purchasing habits and location and to interpret this information to detect irregularities. Money laundering is another situation of where machine learning can identify suspicious activities and call attention to the issue automatically.

Personalized Banking Thanks to AI in Financial Services

As individuals have more and more technologically advanced devices available to them, providing them with services that take advantage of these innovations is crucial. Consumers now use their smartphones for practically everything, so having access to personalized banking services through that means coincides well with an ever more connected lifestyle. From virtual assistants to budgeting tools, bill reminders and novel ways to interact with their bank, users can have a wide array of applications at their disposal thanks to AI in financial services. These not only help them to achieve their financial goals but give them better visibility over the workings of their accounts in general.

From the perspective of the banks themselves, Artificial Intelligence provides a reliable way to gather and interpret data to help them tailor their offering to the needs and wants of their customers. For instance, they can use it to assess whether the ergonomics of their website or application are well suited to their clients’ habits.

Faster, More Efficient, Future-Driven Services

AI in financial services provides new outlooks on how the industry can be run to benefit both banks and their customers. At the same time, it uncovers the potential innovative technologies yield and drives a higher demand in technologically advanced solutions. To accommodate this faster pace, such solutions as cryptography, cognitive computing and virtual reality systems are being adopted, implemented, and adapted to the needs of everyday consumers.

The many benefits of AI in financial services are such that, where this technology used to be considered the frivolous result of a gadget-driven mindset, it now constitutes the backbone of countless business models. As the solutions it provides are being experimented with more and more, the ethical and responsibility concerns it once legitimately raised are currently being addressed very convincingly. While several major actors in the world of finance still err on the side of caution, the perks AI offers today outweigh the negative aspects in most practical applications.

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Nitisha Dubey

I am a Journalist with a post graduate degree in Journalism & Mass Communication. I love reading non-fiction books, exploring different destinations and varieties of cuisines. Biographies and historical movies are few favourites.

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