AI Poised to Lead Fintech Development For The Next Five Years – WEF Study
According to a study by the World Economic Forum (WEF), artificial intelligence is poised to be the predominant force in shaping fintech development for the next five years.
The comprehensive research drew insights from 227 fintech firms spanning five industry verticals which include; digital lending, digital capital raising, digital payments, digital banking & savings, and insurtech.
Geographically, the study covered six regions: Asia-Pacific, Europe, Latin America and the Caribbean, Middle East & North Africa, the US and Canada, and Sub-Saharan Africa.
In the study, a resounding 70% of respondents identified artificial intelligence (AI) as the most relevant topic for the next five years in fintech development. Embedded finance, the digital economy, and open banking closely followed, each garnering 53%-54% of responses.
It is worth noting that in the dynamic world of finance and technology, the synergy between Artificial Intelligence and the financial technology (FinTech) sector has catalyzed remarkable changes that are shaping the future of financial services
Artificial Intelligence (AI) is redefining the landscape of the financial industry in several ways. For instance, the integration of AI in the FinTech sector has propelled the industry to new heights of efficiency and innovation.
By analyzing extensive customer data, AI algorithms can autonomously execute trades, manage investments, and optimize portfolios, enhancing decision-making and reducing human errors.
Also, the introduction of AI in Fintech is transforming the loan and credit assessment process by efficiently evaluating creditworthiness based on financial data, enabling faster and more accurate lending decisions.
The advanced technology also plays a pivotal role in fraud detection by analyzing large volumes of financial data and identifying unusual patterns or suspicious activities.
With AIdriven chatbots used in the FinTech industry, it enhances customer service, as these chatbots can understand and respond to customer queries and requests in natural language.
In the aspect of ensuring regulatory compliance, it assists Fintech companies in monitoring transactions, detecting suspicious activities, and reporting them to regulatory authorities.
