In the grand number of activities going around us, Artificial intelligence is one tech innovation that is still in its early stage to be adopted by the various economic sectors. But it is also a fact that AI is that technical innovation and artificial intelligence development that are being adopted by the different sectors. For information banking operations is one of the premier institutions that are swiftly enabling itself with artificial intelligence features.
Artificial intelligence
It is the digital form of intelligent technology that can learn by itself just like the human brain without much human intervention. In other words, it is designed to act as a tool for problem-solving and take decisions automatically. Thus it is an intelligent form of the digital brain that learns over a period of time just like humans. Additionally, it does not confine itself to the limits of a biological brain but surpasses the capabilities that are not possible biologically.
Role of artificial intelligence in banking operations :
1. Cost reduction
Keeping the cost of banking operations with maintaining quality services is one of the major goals of banking institutions. Artificial intelligence serves as a major tool in reducing the cost in banks. Robotic automation having the data insights using the AI creates amazing results in banking operations as well as the finance industry, on a regular basis. Regular and repeated tasks are handed over the automated process served by ai solutions for banking, whereas the human resource is utilized in more higher-level activities that save time and money for the banking organization. Ai with a high computing process can monitor customers’ data in real-time and displays phenomenal results in decisions making. Therefore in these ways, it keeps the costs and investments low for maximum profit margin.
2. Risk management
Banking is the kind of sector that deals with consistent risk-evolving factors. Especially in credit facilities, the factor of risk becomes a very evident element and it needs to deal carefully while catering the credit services. In other words, we can say that risk in the line of the banking sector is failing of payment of credit by the customer in the agreed time frame. The more time it takes for repayment the risk of converting that into NPA (nonprofitable assets) is also increasing. With the help of artificial intelligence, we can track the credit-taking history of individuals or organizations and evaluate the capacity for repayment of money. Thus using AI we can significantly see less percentage of risk in providing credit or loans to the customers.
3. Customer experience
The level of customer experience has vastly improved with the inclusion of innovative tech like artificial intelligence in the banking sector. Smart features such as personal assistants, chatbots, customized offers, etc in the banking applications as well as websites cater satisfying results in serving their customers. With the analysis of customer spending nature, transactions, savings pattern, etc a customer is served with customized offers by the banking institution that alleviates a customer experience.
4. Digitization
With the internet revolution around the world especially in Asian countries, digitization has become a game-changing factor for various industries. And banking sector is not dissimilar to that process of conversion. Since there are still people who don’t have the small luxury of having a bank account. With the inclusion of AI and machine learning, this problem is solving in the current age. Now users can open a digital bank account by using KYC done digitally without physically appearing in the bank branch. This solves a number of financial problems for the people who either live far away from the branch or dont have the facilities to reach there. Therefore with modern innovations like AI, a user can register for banking services online.
5. Security
Every year we got reports of financial fraud or scams done by people that cost millions to the financial institutions. According to a recent popular report, there are about 47% of banking institutions face fraud. There are certain loopholes in the banking system that is exploited by scammers or hackers to commit financial crimes. To solve this problem machine learning analytics are used to secure the banking digital infrastructure. Using the state of the art machine learning tech with AI it detects suspicious transactions from legitimate ones and secures the banking ecosystem. Security features such as double factor authentication, biometrics, OTP (one-time-password) verification, etc add an extra layer of security that guards the money of the people. Therefore using the AI tech banks strengthens the security.
