Date: 19 September 2023
Author: FINTECH Circle

In the colliding world of finance & Fintech innovation, many companies are now using Artificial Intelligence (AI) and Machine learning to look at different information silos and turn that data into useful ideas.

This helps banks solve their everyday problems, such as Fraud or KYC for approving loans and payments. So, let’s investigate some the interesting things FinTech companies can do with AI and discover why it’s so good for the industry.

Increased Security

AI technology is helping make finance safer. Banks, as we know now all have apps that you can open using your face or fingerprint and this technology is thanks to Artificial Intelligence.

Smart people think that AI will soon replace passwords & usernames. Things like recognizing your voice or face, or using other body data, can make things even more secure. They are definitely harder to trick than regular passwords.

Artificial Intelligence (Ai) in FinTech is all about using behavior patterns to change the way we do finance.

Imagine this: AI watches how you usually handle your money. Now, if someone tries to take out a large withdrawal in a strange place over& over again, AI’s will notice that something’s fishy. It might even stop the transaction to protect you from possible fraud. It’s like having a financial superhero on your side!

Improved Customer Service

There are many use cases when AI can improve customer experience and customer service. A couple of examples include:

Chatbots in FinTech

AI-powered chatbots are like super helpers for call centers. They handle the most common issues that people have, which means less work for the folks on the phones.

Even though chatbots might seem simple, they use really smart technology called sentiment analysis. This helps them understand how customers feel about the service or app and figure out what’s not working so well. Then, the chatbots learn how to fix those issues themselves.

Thanks to these chatbots, talking to your bank becomes easier. They use pre-written instructions to solve basic problems.

And here’s the best part: Some banks, like Bank of America, got a bunch of new customers because of their chatbot. In just two months, they got over a million new clients after introducing it. That’s like making friends with a robot!

AI-Powered Personalized Banking Apps

Lots of banking apps do something really cool: they give you advice that’s just for you. They help you reach your money goals, keep an eye on how much money you make and spend, and do even more. This special treatment is possible because of AI technology in FinTech. 

For example, Bank of America has an app that figures out how you spend your money and makes a plan just for you using AI. And they don’t stop there. They also use AI to guess how likely it is that a company will have trouble paying back a loan.

So, AI is like your personal money wizard, helping you and even big businesses make better financial choices.

User Behavior Analysis

Artificial Intelligence in FinTech can be super smart by using AI tools called APIs. These tools don’t just help users; they also help banks and FinTech companies.

Imagine this: You ask for your expenses from last month, just one request. But behind the scenes, with AI’s help, the system predicts what you’ll ask next (like your income from the previous month) and gives you that info right away in the same response.

This way, we make fewer requests, which is easier on the system, and things work faster. Plus, you, the user, get what you need quicker if the predictions are right. It’s like magic!

Fraud Detection

Fraud is a big problem in the finance world today. In 2020, according to Javelin, people and businesses lost a whopping $56 billion because of fraud. But the damage doesn’t stop at just the money. It also hurts a company’s reputation and makes customers unhappy, which can cost even more.

That’s why banks, big companies, and financial institutions are trying everything they can to stop fraud. AI is one of the tricks up their sleeve. It can spot if something fishy is going on and stop a user’s request or even block them from their account if it thinks there might be fraud happening. So, AI is like a security guard that acts before the bad stuff happens.

AI in FinTech: Wrap-Up

AI in FinTech is like a versatile tool that does many jobs: it helps decide who gets a loan, assists customers, catches fraud, figures out credit risks, and even manages wealth. FinTech companies today use AI to work faster and more accurately, which means they can solve problems quickly.

This AI-powered FinTech stuff is not only super smart but also brings cool innovations. It gives you personalized, fast, and safe services, making customers really happy and reaching people all around the world. So, artificial intelligence is definitely sticking around in the financial world!as we know