7 Ways AI and ML are Transforming Fintech Industry

5 Ways AI and ML are transforming Fintech Industry

Gone are the days, when tedious calculations and resource-dependent tasks used to rule the finance and banking industry. With the advancement of digital technologies, and the emergence of fintech, things changed significantly. Today, whether we talk about cryptocurrencies, or mobile banking, or even digital insurance services, the growth in the fintech industry has boomed. And, one of the reasons for this exponential growth in the finance and banking industry is AI and ML.

Yes, you heard it right! AI in fintech has been playing a major role in transforming the sector and enhancing its capabilities. In fact, the growth of AI in fintech is expected to generate a market value of $35.40 billion by 2025! The adoption of AI and ML in fintech has enabled customers to save their hard-earned money in a personalized manner. That eventually created many opportunities for the fintech industry to gain customer trust, and build a leading name for their brand in the market. But, what does the market look like for AI in Fintech? Is it profitable to invest in AI-based fintech software? Let’s have a look!     

Market Scenario of AI and ML in Fintech Sector

AI and ML have not remained a sci-fi concept anymore. Instead, it has become the leading technology for almost all sectors of the market, and the fintech industry is no exception. Today, many big and small finance companies are using AI-powered fintech solutions to reduce their operational cost, automate their tedious workflows, and to stay competitive in the market. 

You don’t believe us? Well, here are some eye-opening facts that validate our statement:

  • In 2019, the market value of AI in fintech was nearly $6.67 billion in the US alone. However, this value is further expected to reach $22.6 billion by the year 2025.
  • By 2023, the use of AI-powered custom chatbots will help the fintech industry save $7.3 billion of their cost.
  • Almost 31% of the leading financial firms confirmed that they used AI and ML to build digital fintech software for their organization.

Hence, it is evident that the growth of AI in fintech has become a trending aspect of the finance industry, and the businesses, as well as the customers, are benefiting from this trend a lot. Whether we talk about security, personalization, mobile-first experience, fraud detection, or even faster transactions, AI and ML in the fintech industry have facilitated a lot of things that have further boosted the growth in the sector. 

Maybe, that’s the reason why almost 37% of the leading financial firms have readily adopted custom AI solutions for their financial and banking businesses. 

Market Scenario of AI and ML in Fintech Sector

Read More: Ten Fintech Trends To Lookout In 2021

How AI is Transforming Financial Services?

Right from personalization, to mobile-friendly operations, AI and ML in fintech have facilitated a lot of new things that have enhanced the working of the fintech industry. Let’s take a closer look at some of them, and learn how you can implement AI and ML in your finance business.

1. Fraud Detection

The first and foremost application of AI and ML in Fintech is fraud detection. Despite the advancement in the fintech industry, frauds and internet crimes have always been a matter of concern especially for the finance and banking sector. Inefficiencies of the legacy systems, and the gap between the emerging technologies and the old fintech software further facilitated the loopholes in the banking and finance sector. However, with the emergence of AI and ML in Fintech, things changed drastically!

Today, almost all the leading banks and financial institutes are leveraging smart ML-based fraud detection systems that could locate the fraud before it actually impacts the business. Smart ML algorithms, that are especially benefited in the credit card frauds are being used by all the small and large finance businesses due to increased online transactions.  Moreover, the trend of online shopping has further facilitated the use of fraud detection systems to eliminate the online frauds.

Other factors like money laundering and false claims have further boosted the development of custom fraud detection systems that could mitigate and even eliminate all such issues.    

2. Data-Driven Trading

Another robust application of AI in fintech is data-driven trading. Data-driven trading, also known as algorithm trading has become a leading aspect for the people and businesses associated with the stock market. With the use of smart and automated AI algorithms, the custom fintech software analyzes a large set of data to predict the most accurate trends of the stock market. 

The unsupervised ML models collect and analyze the past trends and historical market data. With that information the custom fintech software quickly detects the accurate trends and trading patterns that most of the human experts cannot do. All that eventually helps the marketers to get better returns on their investments, and save their valuable time.

Not to forget that the investment companies also make use of these automated trading systems to benefit their customers and build a name for their brand in the global market.  

3. Automated Claims

Besides the finance and banking sector, another major industry that has been benefited from the emergence of AI and ML in fintech is the insurance industry. Yes, you heard it right! The digital insurance sector, also known as the insurtech sector has been advancing with smart AI solutions. 

With the use of custom AI-powered chatbots, and automated insurance software solutions, the insurtech sector has today simplified their claim settling process. The smart AI fintech solutions automate the claim processes by determining the credibility of the claims, analyzing the genuineness of the case, and automating the claims processing. 

Besides that, the AI-powered fintech software also complies with the ever-changing laws and regulations of the finance and insurance industry, which in turn simplifies the overall working procedures.

4. Virtual Banking Assistance

Who doesn’t like to have personal assistance, especially when you are dealing in the banking and finance sector. However, managing human assistance is both a time and cost-consuming task. And, not to forget, the common mistakes from human nature also add to the complexities of human assistance. That’s where AI in fintech comes to play!

Today, whether we talk about personal finance assistance, or a digital fintech coach, or even a customer-support platform, AI and ML have facilitated the use of virtual assistance in the fintech industry. With a virtual assistant, you can help your customers to know more about your products/services in an automated manner. That way, you can not only increase user satisfaction and revenues, but it can even boost the credibility of your firm in the global market.

Besides the customers, the finance and baking firms also benefit from the AI fintech solutions in a number of ways. The most prominent way is by getting the insights of the customer behaviour that in turn helps the firms to personalize their policy creations such that the customer cannot deny. Hence, with reliable data, profits and customer satisfaction increases exponentially.  

5. Reliable Credit Decisions

Finally, we have a reliable loan and credit decisions as an added benefit of AI in the fintech trend. A major concern of the banking industry is the assessment of credible customers applying for credit card, or loans. As discussed earlier, human nature is faulty, and the detection of reliable users is a tedious task for human resources. Even a slight mistake in validating the credibility of the users could cost the finance and baking firm a huge loss. That’s where AI fintech solutions come into play!

Once you have invested in a reliable AI solution for your fintech industry, you can quickly assess the credibility of a number of users in a short time. Not just the historical banking data, but the custom AI-powered financial solutions could also offer the past credit scores of the user to help you frame better decisions. 

Clearly, another concrete reason to invest in AI-powered fintech solutions for your firm!

Need More Reasons to Invest in AI Powered Fintech Solutions

Ready to Develop your AI-based Fintech Software?

As evident from the above findings, the role of AI and ML in fintech has been significant and is further expected to boost in the coming years. Moreover, a major part of the finance industry today have adopted tech-friendly AI fintech solutions for their organizations. IBut, how can you become a part of those successful companies? 

Well, the answer is simple – by implementing custom AI solutions in your finance and banking firm. That’s where Matellio comes to play!

With years-long experience in delivering personalized AI applications to a number of businesses, we today have become a leading choice of marketers when it comes to AI Fintech Software Development. Our agile development methodology and expert engineers makes AI software development easy and cost-effective for your firm. So, whether you are a startup or a Fortune 500 company, here’s how you can create your custom AI fintech software in 5 easy steps with us.

1. Fill the Consultation Form

The first step in developing a custom AI solution for your fintech industry would be to fill our consultation form. You need to enter your basic details like name, a valid email address, your contact number, and a short message describing your requirements. Once the form is filled, our business analyst would contact you regarding the scheduling of the call with our AI experts.  

On the call, you can discuss your business ideas, and could also know the current market trends that could make your custom fintech software a hit in the market. 

2. Choose Relevant Tech-Stack

The next step would be to choose the relevant tech stack for your custom AI solution that could help you bring more value to your business. For that, once again an expert consultation service would help. That’s because, you might know a lot of AI trends in the market, but choosing the more reliable ones is a tedious task. Hence, with our free consultation service, you could choose the most suitable tech stack for your fintech software.

Here are some common tech-stacks that our experts at Matellio use while creating enterprise AI solutions.

  • Python
  • Dialog Flow
  • Anaconda
  • Pandas
  • TensorFlow
  • Wit.ai
  • PyTorch

3. Include Aesthetic Design and Features

Now, it is no surprise today that the market is filled with options for every single product/service, and fintech software is no exception. Hence, to make your custom AI project a hit you need to offer some advanced and user-friendly features to your users to gain their attention.

Likewise, the design also plays an important role in the success of your custom AI solution. In fact, even if you have all the advanced features, and they are not properly accessible, then the users will discard your fintech software very quickly. Hence, to make them effective, hiring the best UI/UX designers is the foremost need that could be again satisfied at Matellio. 

4. Hire Professional Developers

Step four of the AI software development for the fintech industry is to finalize your development team. Before beginning the custom project, it is essential for you to have a fully flexible development team ready for your project. Right from an experienced project manager, to UI/UX designer, backend developer, and even a tester, a perfect development team is always needed for a successful and cost-effective project. 

Hence, with Matellio, you can hire your suitable development team at flexible hiring models. Plus, our experts could also suggest the best resources that you can leverage from time to time for your project. 

5. Test and Deploy

The last and final step of AI software development for the fintech industry is to test your fintech software for any errors that were left unidentified during the development phase. Testing ensures that your custom fintech software is free from all the glitches and bugs that could hamper your business and brand value in the market.

Hence, make sure that you test your custom fintech solution using our manual or automated testing services that are included in our software development service. With automated testing, the results will be more accurate and faster, but, the cost will be slightly more than the manual testing services. So, analyze and choose a testing service that best suits your business and project needs.

Professional and Custom AI Fintech Solutions are Just a Click Away From You

Conclusion

So, those were some of the ways in which AI in fintech is becoming a global trend of 2021. To conclude, we can say that the digital world today is an ever-changing and expanding market. What once used to be an imaginary concept has today penetrated into the common lives of the people, and AI is one such technology. Right from chatbots, to automated insurance software, and even personalized mobile banking apps. AI and ML in fintech have become a core concept for the finance and banking industry. Even the customers have readily adopted the smart AI technology to satisfy their needs in a better way.

Hence, witnessing such huge and faster adoption, it is recommended that you should also include AI and ML to enhance your finance business. With custom AI solutions, you can not just offer an excellent experience to your users, but could even scale your business operations to a more profitable level. So, connect with us and begin your AI development today! Plus, get a free expert consultation for your business idea by filling our consultation form

Till then, Happy Reading!

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