Artificial Intelligence and the Future of Banking and Finance

A I Artificial Intelligence On Guard Against Fraud

Artificial intelligence (AI) is expected to be the next big thing in the banking and financial services sector; it has been touted as next great breakthrough that will change the way we bank and conduct financial transactions.

Why not, the vast amount of data, high volume transactions, and the quantitative nature of the banking and finance industry makes it one of the sectors where artificial intelligence will be better applied. It is believed that financial institutions can leverage the power of AI to transform current processes and improve services delivery as well as the use of financial products.

A Powerful New Weapon Against Financial Fraud

In today’s low-trust environment, artificial intelligence offers a new way to tackle financial fraud, build trust, and create a secure financial atmosphere. New forms of AI are being introduced to catch fraudsters with exceptional speed and efficiency.

Thanks to such new technologies, artificial intelligence could identify irregularities or patterns in transactions which might point to fraud, money-laundering, or terrorist activity. Tools like machine learning and data analytics could be used to scrutinize the vast amounts of data AI holds on clients and transactions, and compare this information against publicly held data to flag suspicious activity for security teams.

Asides these anomaly detection apps, future security measures will require biometric data such as facial recognition, voice recognition, etc., to provide more protection to customers.

Role in Customer Service as well as Sales and recommendation of Financial Products

Other potential future applications of AI in banking and finance lie in the area of customer service and sales of financial products. An Accenture report states that artificial intelligence will become the primary channel through which financial institutions and their clients will interact in future. Indeed, this prediction is fast becoming a reality thanks to organizations like Kasisto, which are developing chatbots that enable bank customers to chat with their financial institution using text-based natural language.

The Kasisto app facilitates finance-specific interactions by allowing customers to ask finance related questions via chat. Similarly, McLean-based Capital One Finance has developed a chatbot called Eno to enable its clients to complete a broad array of tasks on their smartphone. Customers can use the app to transact, check their account balances, as well as request card information such as bill dates and limits.

Beyond its role in enhancing customer experiences, AI is also expected to play a significant part in the sales and recommendation of financial products. For instance, a robo-advisor might recommend portfolio changes. It is also believed that robo-advisors could potentially employ some level of machine learning to recommend a specific car or home insurance plan.

As AI continues its journey into the mainstream, it is predicted that the technology will play a more prominent role in reinventing the banking and financial services landscape by making it much easier for banks to analyze risks and assess the behavior of a prospect to discover any possible fraud, among other things.