The fintech sector is increasingly using AI in financial inclusion to analyze loans and choose sales recommendations for financial products. Most of the time, the artificial intelligence is being employed for these activities using previous financial institutional data.
Lending only based on information available on a customer’s mobile device, or building a mobile digital credit shop, was an experimental strategy in the past, but it is now a reality. As traditional banks collaborate with fintech’s to offer digital credit services, new business models are starting to develop.
All of this can be made possible by AI-based technologies that use data and machine learning algorithms to identify financial frauds, determine creditworthiness, and assist banks in giving consumers the best advise possible. Additionally, AI can support banks’ attempts to increase client acquisition, retention, and service.
What is AI in financial inclusion can be best understood when one studies its importance and as per the experts of FIA Global (a leading business correspondent service provider) by the end of 2035, AI is expected to increase the net worth of banking/financial sector by $1.2 trillion.
Due to the production of enormous amounts of data and the low cost of storing and accessing that data, along with improvements in computer power and a decline in the cost of computation, AI has gained importance in the banking industry.
AI-enabled solutions are enabling branchless banking in India, where many individuals still lack access to neighborhood brick-and-mortar banks. This lowers expenses for the banks while increasing accessibility to financial services.
Through messaging apps, banks are interacting with customers and educating them about their financial well-being. AI-enabled chat bots are available round-the-clock to respond to questions and explain how things function.
The financial sector is an excellent match for AI because of its quick scalability. To evaluate the credit quality of startups, MSMEs, and rising digital enterprises, data analytics and AI algorithms is emerging as a game changer.
By utilizing the data that is already accessible and developing products and services with enormous potential, many entrepreneurs and fintech companies are embracing disruptive techniques to create value.
