You know how intertwined AI and finance have been for decades, right? Believe it or not, as far back as the 1960s, AI was already used to monitor stock markets and make predictions. AI in finance isn't just about crunching numbers and making predictions. It's playing a much more significant role, streamlining internal processes, enhancing customer experiences, and even taking care of routine tasks through automation.
Last year, AI in the fintech market was valued at $7.91 billion and is projected to reach $26.67 billion by 2026. This surge is powered by advances in automated trading tech, more innovative fraud prevention, improved risk management, and rapid customer support.
Here are a few ways AI is revolutionizing finance:
Automating Process Management and Back-End Operations - AI, with NLP, is helping firms automate the handling of accounts receivables/payables, invoices, and accounting requests.
Optimizing Trading Activity for Better Returns - Both quantitative and algorithmic trading are now heavily reliant on AI. These systems can process large datasets and identify patterns more efficiently.
Enhancing The Personalized Banking Experience - AI is making banking more personal by offering tailored financial advice and guidance.
Creating More Effective Fraud Detection Measures - AI is instrumental in cybersecurity and fraud detection, helping spot anomalous spending patterns among credit customers.
Informing Credit Decisions - AI has enabled banks to use behavioral attributes to create ML models for credit risk and worthiness, including those who were previously unaccounted for.
How do you think AI will further reshape finance? Are there any risks or challenges we should be wary of?