If there is one technology innovation which has taken every industry by storm, it is artificial intelligence. Yes, numerous industries have benefited for the better from this new technology. In fact, even the medical industry which has always stayed aloof from technology innovations, has implemented many Artificial Intelligence applications. In this article, we focus on artificial intelligence in the finance sector. Every reputed finance company in developed countries have started using Artificial intelligence applications for saving time, reducing the costs and to add value.
Best Example –
The best example as of now is WealthFront (roboadvisor) which uses the capabilities of AI for analysis. It analyses every account holder’s data to find out how they spend, their earnings and helps them make sound financial decisions.
As of now, a survey in 2016 has reported that funding companies in developed countries have made use of AI in their transactions. To be precise, nearly 550 companies have invested in AI to the tune of 5 billion dollars. As of now, the business industry speculates, that nearly 250 companies will redefine the financial service industry. The importance of Artificial Intelligence is at its peak. In the Annual Technology Innovation Summit of 2016, hosted in Silicon Valley, Virtual Reality, robotics, and artificial intelligence were named as the upcoming technologies which could shape the future.
1. Applications of Artificial Intelligence in Banks
CoiN or Contract Intelligence platform in JP Morgan Chase makes use of image recognition software for analyzing legal documents. It can also extract important data points as well as the clauses in very less time. On the whole, it can save nearly thousands of hours spent on manual work. So, you can get the commercial credit agreements viewed in as little time as possible.
Wells Fargo, on the other hand, has an AI applied chatbot which can give relevant account information to customers. It chats with the customer via Facebook Messenger and other applications and helps customers to reset their passwords. This is but one example of Artificial Intelligence in the Finance Sector, that is banks.
2. Best Benefits From Artificial Intelligence
AI technology applications will be implemented not only in leading financial companies but also in small companies of other industries. In the Finance industry, AI will assist the company management in making the best use of their resources, reduce risk and fraud, generate more revenue in the banking, investing and other sectors. The other areas, AI can make an impact are customer service, generating insights and making predictions about the performance and returns for the month and year. These are some benefits which financial institutions can make out of Artificial Intelligence in the Finance Sector.
3. AI Algorithms
Remember automation. It is a process used in factories to replace the work of repetitive manual tasks with machines. But now, this aspect has even stepped into the financial sector. AI can match data records, looking for changes and mistakes.
The next step of Artificial Intelligence is machine learning. Please note, AI can answer simple queries and simple tasks. But the complex task is done only by machine learning technologies. In this technology, the applications constantly learn by themselves by making use of artificial neural networks.
At present, AI can the ability to handle three types of data.
- Numbers and parameters. They generate insights about human accuracy
- Analysis, interpretation, and writing of the text. AI can also make use of context natural language processing with AI applications
- It can also detect similarities in pie charts, can identify face recognition, detection of activities and making use of deep learning methods for making analysis tasks easier.
4. Trading – Done Easy With AI Algorithms
There was the time when trading was done only with the help of financial data received from journals and the Stock Index. Now, numerous other factors have to be taken into consideration such as social media. And it is a manual task and requires many human hands. Imagine, instead, an AI application browsing through various media and doing the same work in less time.
Aidiya, the Hong Kong-based start-up has made use of AI to predict price changes from various sources. On the other hand, Nomura Securities uses AI to indulge in fast trading by analysis of data patterns. These are some of the benefits of Artificial Intelligence in the Finance Industry.
B2C Robo advisors have already been used in Financial Investments. These applications cross-check the decision made by humans. For example, the database designed by the company Kensho makes use of AI to provide traders and investment bankers with financial trends around the world. Another company, ForwardLane offers financial advisors with personal investment advice to common people.
5. Banking – Artificial Intelligence Can Enhance Efficiency And Manage Risk
Have you ever entered into a discussion with the bank executive? You enter into a conversation and describe your problem. You get the solution, give a thank you and keep the phone down. Now shall we take a case study? You work in a home maintenance company in Bangalore. It provides handyman professionals and doorstep repair services in Bangalore for home electronic appliances. You have invested in mutual funds from a reputed financial enterprise company. You find there are some discrepancies in the statement. So, you call customer service.
But you do not know that the call attending facility is a chatbot or a human. AI applied chatbots help to solve simple customer queries. For the complex questions, the AI reroutes the call to a human or a complex chatbot which has machine learning applications. Now, this ML chatbot can learn by itself and can service even complex queries.
The best example you can get, in this aspect, is the chatbot from Wells Fargo. It has proved its ability by improving the customer experience and reduce time, cost. These virtual assistants use cognitive technology and predictive analytics to personalize your experience.
It takes information from various factors such as banking history, your salary to give the best advice on many matters. Now imagine if the same task has to be done by a human. He/she has to look into different portals, link the data and give correct information. You need at least two persons for such jobs and lots of time. Now, the same job can be completed by a chatbot in less time.
Have you read the article on Artificial intelligence in Finance? Yes, there are other areas also that the AI has made an impact such as credit lending, fraud detection, and image recognition. Keep visiting our website. We can give you updates in the next article.