The global market size of artificial intelligence (AI) in fintech is rapidly expanding.
With regulation, security and the opportunity to know your customer more, at stake that’s not surprising, as we find out.
AI is now used by many fintechs, and this summer they have not been slow in securing funding for their AI projects.
One example includes Bud, an open banking fintech startup used by mainstream players including HSBC and Credit Karma. It raised £63.8m in a Series B funding round.
Bud said it will use the capital to continue developing its platform, which uses artificial intelligence (AI) to let financial organisations offer customised products and automate their lending decisions.
AI, fintech and fraud
The global artificial intelligence in fintech market size is expected to grow by 16.5 per cent to over £33bn (US$41.16bn) by 2030.
The findings were published in a report by a US-based market research and consulting company, Grand View Research.
Grand View Research predicted AI would continue to be embraced by fintechs to “improvise their precision levels, enhance their efficiency and instant query resolving through digital banking channels”.
In a world where the risk of cyber attract and fraud have increased exponentially, AI is providing a machine learning solution which can improve underwriting and eliminate. financial risk.
With regulation of third parties on the horizon for financial services in the UK, anything that improves fraud detection will be first on the fintech AI wishlist.
Ultimately though AI machine learning allows banks and fintechs to process massive volumes of client data, arguably the most prized form of intelligence.
Grand View’s Sherry James points out that financial institutions and banks are implementing AI technologies to unlock insights and information hidden in unstructured documents and automate the manual processes that banks have historically performed at double-quick speed.
“In addition, the growing demand for process automation between financial institutions is propelling the market. Blockchain and distributed ledger technology enhance AI adoption in the financial sector by providing new means to record, track, and store financial asset transactions.”
North American AI and fintech
Grand View points most of the AI-led fintech growth in the next seven to eight years will come from North America, which, it claimed “had the most competitive and constantly changing AI technology in the world's fintech sector” and had a “strong emphasis on R & D-derived inventions”.
Expect to see more fintechs or financial institutions set up their own subsidiary providers, following the likes of KBC Group, a Belgian-based multi-channel bank insurer.
Earlier this year it commercialised its portfolio of AI applications through Discai, its wholly-owned subsidiary, beginning with introducing an AI application meant to prevent money laundering.
Discai will provide an AI-based system which can closely monitor money laundering, and collaborate with partners to distribute and integrate these applications.
AI and fintech - making it easier to track payments and buy shares
A prominent trend in AI in the fintech business is also through the widespread use and integration of smart mobile payment solutions.
Grand View said many participants in the market provide payment platforms and are continually adding new features, such as voice commands and biometric access control, which includes fingerprint and facial recognition.
In November 2021, Paytm, an Indian multinational financial technology provider, announced the launch of its AI-driven 'Voice Trading', which allows customers to acquire stock information or place a trade with a single voice command. The voice trading function allows a single voice command to be processed instantly using neural networks.
Now that is, instinctive!
Grand View’s top 15 list of key players of AI in the fintech market.
To find out what this means for innovation we can only watch and wait.
● Google LLC
● Salesforce, Inc.
● International Business Machines Corp.
● Amelia US LLC
● Nuance Communications, Inc.
● Narrative Science
● Affirm, Inc
● Upstart Network, Inc.
● Instructure, Inc.
● Inbenta Technologies
● Amazon Web Services