The Growing Impact of AI in Financial Services
We all deal with money and have been doing so since who knows how many centuries. When it comes to the financial industry, some major changes have taken place in the last few decades. This has not just led to better services which are now offered by this industry but has also led to enhanced accuracy, speed, and overall efficiency. All of this has been possible because of the technology of Artificial Intelligence (AI). AI has revolutionized the way we perceive and interact with the financial industry.
What’s more shocking than this is that this technology is continuing to benefit the financial industry to this very day! AI has created a huge impact on financial services and is continuing to do so. Now, we will be listing some of the most vital changes which AI brought to financial services.
Credit Scoring provided by AI
AI has enabled various financial organizations to make quick and accurate credit decisions. This is simply being done because of the fact that AI provides a quick assessment of the potential borrower and also accounts for a number of factors. This leads to a better decision-making process which is backed up by significant data. These days AI also provides credit scoring making the scoring system become more complex and sophisticated. Another major benefit of AI in this regard is that it is completely unbiased which a human being might not necessarily be.
Risk Management provided by AI
Because of AI, financial organizations can quickly analyze a tremendous amount of data within a short period of time. With the help of cognitive computing, one can also manage all sorts of data including structured and unstructured data. These facts will allow the organization to quickly identify all possible future issues and know the kind of risk which is involved in all major decisions. This can prevent the organization from making huge mistakes down the road. A great example of this could be Crest Financial. This is a leading company based in the USA. This company employed artificial intelligence and quickly saw a major improvement in all risk case analysis.
The Prevention of Fraud provided by AI
For a number of years now, artificial intelligence has been very successful in battling financial fraud — and the future is looking brighter every year, as machine learning is catching up with the criminals.
AI is especially effective at preventing credit card fraud, which has been growing exponentially in recent years due to the increase of e-commerce and online transactions. Fraud detection systems analyze clients’ behavior, location, and buying habits and trigger a security mechanism when something seems out of order and contradicts the established spending pattern.
Banks also employ artificial intelligence to reveal and prevent another infamous type of financial crime: money laundering. Machines recognize suspicious activity and help to cut the costs of investigating the alleged money-laundering schemes.
Trading provided by AI
Trading has gained a lot of importance and popularity since the last few years. It has expanded across all markets of the world and many experts have turned to AI to get multiple benefits in this regard. With the help of Intelligent Trading Systems, experts can quickly analyze all sorts of data in a fraction of time. The predictions for stock performance are more accurate, due to the fact that algorithms can test trading systems based on past data and bring the validation process to a whole new level before pushing it live. This means that an individual would be able to make faster decisions, faster transactions, and higher profits.
The Personalized Banking Services provided by AI
AI has truly shown its worth by providing extra comfort and benefits to all customers. In the financial sector, many organizations are employing AI-powered chatbots. These chatbots provide quick self-help solution to all customers with a click of a few buttons. This does not just reduce the workload of the employees but also provides higher quality services to all customers in turn, leads to better customer experience.
These are all the major ways in which AI is having a growing impact on financial services.