We are in an era where the technologies enable machines to simulate and augment human intelligence. Financial services companies, too, are inside the circle of intelligence age. The banking sector is primarily a world of computers and networks and the world's wealth is stored in databases, and transactions are simply the exchanges of information over networks. The purpose of introducing AI in the banking sector or the aim is to revolutionize the working of banking and keeps a promising relationship between banks and their customers' experience.
The technology itself is getting better and smarter day by day, allowing newer industries to adopt the AI for effective applications. The banking sector is becoming one of the primary adopters of AI. Apart from other sectors banks are exploring and implementing AI technologies even faster and better. Banks are using AI technology for enhancing the customer experience by giving it a personalized touch. Most of the banks in India have started embracing AI and related technologies. A survey by the National Business Research Institute says that over 32% of financial institutions use AI for voice recognition and predictive analysis. How AI Improves Customer Services
Implementing new technology in financial service is quite difficult. But still, we welcome new applications in AI. Millions of transactions are done online irrespective of time and place worldwide. We can mention that automated processes and other applications are largely attributed to the integration of AI in the banking system and mobile banking apps. The working of AI in the mobile banking app is well processed. After gathering the data from the user’s mobile devices, the AI-based mobile banking app processes the data through machine learning to provide the relevant information or redirecting the users to the source of information. AI-related features are capable to show services, offers, and insights in line with the user’s behavior.
AI has immense potential for the banking sector and it can show wonders. It brings automation and simplifies the traditional banking process. A chatbot is one of the applications of AI which reduces the banking workload. It can act as an answering machine and serve the customers continuously throughout the day. It deals with direct and basic operations including opening or closing the account, transfer of funds, and other banking features. Though customer care executives are serving the customers well, they have limitations of time and the number of persons they can attend in a day.
Accumulate and analyze useful data is another pattern followed in concerning AI. The revolutionary AI technology works on the principle of data collection and analysis. Any AI system can work well with better data sets. A featured mobile banking app enriched with AI-based features can collect all the relevant and useful data of the users to improvise the learning process and enhance the overall user experience. After accumulating and analyzing the data, the experience can be made more personalized. Also, the data regarding the financial transaction can help the bank understand the expenditure pattern of the customer. The bank can come up with a customized investment plan accordingly and also assist the customers for budgeting.
There are a lot of customers who hate to visit a bank. AI can bring banking to their fingertips. Wealth management and portfolio management can be done effectively and efficiently with AI. Customers can get the benefits of automated and safe transactions. They get a notification instantly for any suspicious transaction as per their usual patterns.
Another useful application of AI is a card management system. It not only automates the credit and debit card management system but also makes it safer. It helps the customer get rid of a long authentication process in the case of losing the card.
The AI system saves time and efforts of the customers and in a way, improves the mobile banking services. It is capable of handling risk management. The risk assessment process while giving loans is critical. AI can handle and simplify this process by analyzing relevant data of the prospective borrower. Banks should be bankable for providing secure and swift transactions. AI is designed to detect the fraud in the transactions based on a pre-defined set of rules. Also, the mobile app can find out any suspicious activity in the customer’s account based on behavior analysis.
AI also plays a vital role in protecting personal data. As we witness a rapid rise in the instances of cybercrimes in the recent years, AI-based fraud detection can lend a helping hand in preventing such attempts. So, for the banking and finance sector, AI has a tremendous scope in the domain of cybersecurity. Globally, hedge funds prefer AI-based models. It is because AI-related tools can fetch real-time data from various financial markets across the world. Also, AI models can analyze the mood or sentiments of different financial markets and come up with an accurate prediction. These inputs and sophisticated algorithms make AI models capable of assisting the users to make decisions quickly.
AI can bring revolutionary changes in the banking industry. As mentioned earlier, these are just a few use cases of AI in banking, and there are many ways AI is being explored in the industry. There are a lot of manual works still going on inside financial services. One such process is manually entering user details digitally. User has to present their documents like Adhar, passport copies, etc for various purposes. In such cases, the bank employees have to enter those data manually for its digitalization. But ongoing applications like Pixl KYC Document Extractors, Pixl Invoice readers are solutions to such manual works. These are some vital steps not only for financial applications but can eventually change several manual works in the future.
We didn't see the full impact of AI in India. If we have a look into AI globally, the space of AI is Close to 9% of all share of deals. AI relatively as part of the deal in India is small. 50 % of shares go to China and they are the leaders of AI shares and 38 goes to the US. In total 88% are ruled by China and the US and the rest is shared with different developed countries. AI will clear out sophisticated roles in the future. As AI capabilities advance over the next fifteen years, experts believe that by 2030, it will begin to take the place of more complex jobs. Right now, it can't effectively carry out roles that require multi-disciplinary oversight and execution. AI can show expertise in tax dealers, Loan officers, Financial advisors, Financial analysts.
AI has already begun its success journey to change finance. Through technology in algorithms, big data, and high-frequency trading, AI has deeply impacted financial markets. Besides needing to clear regulatory hurdles and modernize legacy systems, banks require more time to fully evaluate how and where AI can be implemented before repetitive jobs will begin to see change. Technology has completely overhauled other industries in recent decades, including the media and music industry. Futurists now say it is the turn of finance. While nobody knows for certain how the change will exactly play out, it is highly likely that AI will transform the industry in powerful ways that society can both predict and only brace for. Within a short period, we can see a drastic change in the banking sector.