How Is The Indian Fintech Sector Using AI?
Artificial intelligence or AI and other related technologies like machine learning, big data analytics, and evolutionary algorithms have revolutionised the Indian fintech sector. From a web-based connection and real-time data integration to the digitalisation of financial transactions, AI-based tools are increasingly used by FinTech apps like KredX to offer more transparent and faster solutions. Furthermore, AI in FinTech also allows companies to optimise and streamline processes like credit decisions and credit monitoring, thereby helping with risk and liquidity management.
In the section below, we have put together how AI-based solutions are used by FinTech companies leading the way.
5 Innovative Ways FinTech Companies Are Using AI
Seamless Customer Support
AI is making customer support and interaction interfaces much more aligned and efficient. It helps streamline the solutions based on individual customer needs by quickly analysing data from previous preferences, browsing history, and conversations. FinTech companies are, therefore, leveraging AI-based solutions like robot assistants and other systems to:
- Gather information
- Offer user-friendly customer experience
- Create solutions and products that align with their customer’s requirements
- To provide real-time alert messages
- To offer customised offers and discounts
- Provide real-time support with the help of FAQs, blogs chats, reports, etc.
FinTech companies are also using AI to automate response for uninterrupted assistance in regard to client queries round the clock.
Data-Driven Due Diligence
AI in FinTech allows companies to reduce the Due Diligence cost significantly. Gone are the days where firms had to manually sweep through their client’s credit history, financial records, and tax records individually to arrive at a decision. Instead, AI and machine learning are capable of comprehending and analysing truckloads of data within an instant. It also keeps the data updated to offer insights at all stages of the lending span, enhancing risk management.
AI in FinTech helps with the detection of suspicious behaviour of borrowers. The biggest impediments of the traditional fraud detection method are that it is a slow and long-drawn process, consisting of numerous verification steps, and it reacts to certain limited red flags only. To this end, the advantage of AI and machine learning is enormous, as illustrated below:
- AI helps identify implicit and hidden data correlations
- Reduces the steps required in the verification process as compared to the rule-based system
- It helps with detecting any kind of anomalous behaviour
- Automatic detection of fraud scenarios
- Provides real-time processing
- Offers adequate solutions to eliminate the chances of fraud and reduce losses
With the advent of AI, FinTech companies can use alternate credit score analytic methods like metadata analysis through smartphones. It provides insights into the borrower’s spending pattern. Also, several FinTech companies offering business loans utilise AI-based solutions to analyse data points from various sources to estimate the creditworthiness of small businesses or MSMEs efficiently.
Money lending apps are a case study of how FinTech companies are benefiting from AI. These AI-based apps assess an individual borrower’s financial habits and credit exposure, thereby expediting the loan underwriting process and eliminating the risks involved in traditional approaches. Furthermore, it also helps customers with the elimination of biases that occur from human error.
In a nutshell:
Adoption of AI in Fintech is rising because:
- It offers secure, fast, and reliable transaction facilities in the finance ecosystem.
- AI provides excellent data-driven solutions.
- It offers cost-effective and tailored solutions as per individual customer needs.
- Artificial Intelligence provides a complete bouquet of operations to facilitate uncompromised fraud identification and prevention.
- It improves a company’s credibility with real-time data processing and customer support.
- AI improvises customer experience by cognitive and sentiment analytics.
- It offers guaranteed solutions for complex problems.
- AI-based solutions are simple and conveniently accessible by the masses.
- This builds scope for a set of financial services that goes beyond the core offerings.
- AI comprises uninterrupted virtual assistants with tailored recommendations that help manage expenses, savings and also monitor trending prices.
AI in FinTech and other advanced and innovative technologies tend to bring an incredible pool of opportunities for Fintech companies and other financial businesses. It boosts growth and also improves the service framework. The advanced algorithm systems are helping save valuable time, reduce costs, and increase the efficiency of eliminating any risks. FinTech companies are closely working with developers, designers, and techs to incorporate new AI solutions for optimising processes and improving customer experience