Just when we thought that technology had touched all the relevant areas of financial services, comes the news on how artificial intelligence (AI) can replace humans in the capital market. Now AI is not something new in the financial sector – in fact, its roots can be traced back to the 50s and 60s when the financial industry was on the path of technical evolution. For instance, banking sector adopted AI for better synchronization and processing of data, customer personalization, as well as pattern identification. But with speculations on how AI can replace humans in investment banking, it seems the scope of its application seems to be expanding at an unfathomable rate.
Financial services and artificial intelligence
Easy and seamless customer experience is the goal of all financial organizations. And this is the tipping point for innovative use of technology in almost every aspect of the financial dealing. Right from providing relevant products to customers, to better risk management, and regulatory compliance – AI covers everything in one clear shot.
So much is the relevance of AI in the financial industry that several major financial institutions have allocated a good part of their budget to AI. There is a long list of organizations which are still catching up with technology through the adoption of cloud computing, big data, and open-source software. Thus, eventually, all financial institutions will find a place in the AI net, transforming the way in which business is conducted.
At the same time care needs to be taken that AI has different applications for different financial verticals. It surely does not work on the ‘one size fits all’ theory. Thus, while on the one hand it might be used for improved data processing only, there are many who regard AI as the key to error-less algorithm analysis. One of the best analogies for this is, how just 26% of asset and wealth management companies are dependent on machine algorithms. But in the case of the insurance industry, AI is used by more than 50% of the organizations.
The way ahead – Infiniti Advantage
Automation of work process is perhaps one of the most fool-proof ways through which better results can be gained with a smaller amount of investment. Especially in an area like capital market, where the stakes are rather high, AI is poised to bring structure to the chaos. At the same time, there is a fair amount of apprehension on AI’s operating process – which brings us to the conclusion that AI should be seen more as a collaborative initiative rather than just being a technology vending out standard solutions.