When most people think of AI, they envision robots carrying out tasks, holding conversations, and even becoming sentient. The idea is that AI will look very much like human intelligence and that we are working towards a future of artificial people. However, most AI advancements are happening in a very different context.
Financial technology is perhaps the biggest industry where AI is proving to be especially useful. This makes sense. Financial industries have often driven the advancement of technology. Using machine learning (ML) and AI, Fintech startups are creating accurate and efficient processes which generate endless potential.
One such example is in the insurance world. Already, Walnut Algorithms uses AI to create accurate investment returns strategies. Another example is Lemonade, which provides renters insurance quotes in 90 seconds by using AI technology. This is possible because AI can take into account more data about a potential customer than a human ever could. Quotes can therefore be priced accurately and fairly.
Let’s look at the Fintech industry on a broader scale to see just how AI will be the future of financial services.
Beyond Big Data
Big data has been a huge deal in financial services. Whereas in the past, financial profiles and risk assessments were generated based on what a person disclosed, big data allowed for the use of an immense amount of data points. Companies could get an extremely accurate assessment that went beyond what even the customer knew about themself.
However, AI is taking us far beyond what big data could achieve. Rather than sticking to the parameters set by human programmers, AI takes advantage of ML to generate data based on factors we could never have imagined. It grows big data exponentially, not by increasing the amount of tracking of the person, but by using advanced interpretations of data.
In the context of insurance, this allows for far more than precise pricing on premiums. Fintech companies can use this data to encourage behaviors that AI has discovered lead to lower levels of financial risk. This helps both the company and the client.
Also read: Apple Watch Not Connecting To Phone: Here’s The 5 Reasons and Fixes!Investment Advice and Debt Counseling
We’ve seen how AI plays a huge part in the internal functioning of financial services. But what about on a person-to-person basis?
Financial literacy is in short supply for people both young and old. It is not taught to a great degree at school or college unless you specifically study a finance degree (in which case you learn it tangentially). Today, people can learn about investing and how to get out of debt from online courses and blogs. However, these mediums have to take a one-size-fits-all approach.
AI will soon change that. Rather than reading a number of articles about investing, people will soon speak to an AI advisor regarding their own personal finances. This AI advisor will be able to guide them through their potential options, showing them multiple possible scenarios. The AI will advise certain approaches and will leave the person to make a well-informed decision.
The same is true of credit or debt counseling. One of the reasons credit counseling is not effective with many people is that they are reluctant to share their personal financial situations with other people. There is a lot of shame in the way many of us approach the topic of finances, especially when we are in debt.
A debt-counseling AI can take all the shame out of the equation. It can access your financial records directly, finding a number of routes out of debt. It can show you exactly how to start working towards a healthy financial reality. With human limits, most debt counselors will struggle to even determine what a healthy financial reality means for each individual.
AI is the future of Fintech. It is already taking many financial services companies towards greater and greater potential.
Top 10 News
-
01
10 Exciting iPhone 16 Features You Can Try Right Now
Tuesday November 19, 2024
-
02
10 Best Anatomy Apps For Physiologist Beginners
Tuesday November 12, 2024
-
03
Top 10 Websites And Apps Like Thumbtack
Tuesday November 5, 2024
-
04
Top 10 Sites Like Omegle That Offer Random Video Chat
Monday October 21, 2024
-
05
Entrepreneurial Ideas To Make 5K In A Month (10 Realistic Wa...
Monday October 7, 2024
-
06
[10 Best] Cash Advance Apps Like Moneylion And Dave (No Cred...
Friday September 20, 2024
-
07
Top 10 Richest Person In The World
Tuesday August 27, 2024
-
08
Top 10 Unicorn Startups In The World (2024-25)
Monday August 26, 2024
-
09
Top 10 IT Companies In The World By Market Cap
Thursday August 22, 2024
-
10
[10 New] Best OnionPlay Alternatives To Stream TV Shows And ...
Tuesday June 11, 2024
Related Posts
Finance
Currency Risk Management: Essential Hedging Techniques for B...
By: Neeraj Gupta, Sat November 16, 2024
An important financial contrivance, currency hedging shields your company from..
Finance
Software Development In Finance Service: Driving Innovation ...
By: Neeraj Gupta, Sun October 13, 2024
Technology has revolutionized the finance industry and changed banking and..
Finance
[30 Best] Apps That Pay $100 A Day For Real (With No Deposit...
By: Bharat Kumar, Wed October 2, 2024
Think of apps that pay $100 a day instantly often without checking your credit..
Finance
A Guide To 401K Hardship Withdrawal Reasons
By: Bharat Kumar, Tue September 17, 2024
401k hardship withdrawal reason is treated legal and falls under retirement..
Finance
How To Cancel MoneyLion Account Quickly?
By: Bharat Kumar, Mon September 16, 2024
There can be multiple reasons to delete or cancel moneylion account..
Finance
How to Navigate Financial Market Uncertainty with AI
By: Neeraj Gupta, Sun September 8, 2024
The financial markets have every time been tagged by incalculability. Market..
Subscribe
0 Comments