The introduction of Artificial Intelligence (AI) is affecting every individual and business in a different way. India, which is now emerging as a powerhouse in the world of fintech with a rapidly growing economy and a tech-savvy population, has become a hub for financial technology innovation. Here is how fintech companies are transforming by leveraging the power of AI to expand the reach of the financial and payments products.
“Artificial intelligence (AI) applies advanced analysis and logic-based techniques, including machine learning, to interpret events, support and automate decisions, and take actions,” according to technology industry analyst firm Gartner.
With the evolution of the fintech industry, companies are adopting AI to create innovative products and services. “By leveraging the power of artificial intelligence, fintech companies can analyze large data sets, detect patterns, and make predictions that can improve decision-making, reduce fraud, and increase customer satisfaction,” Oyindamola Soyinka, Sales Executive at ASSA ABLOY Global Solutions said in a LinkedIn post.
Meanwhile, the latest annual McKinsey Global Survey on the current state of AI confirms the explosive growth of generative AI (gen AI) tools. One-third of the survey respondents say their organizations are using gen AI regularly in at least one business function. “Amid recent advances, AI has risen from a topic relegated to tech employees to a focus of company leaders: nearly one-quarter of surveyed C-suite executives say they are personally using gen AI tools for work, and more than one-quarter of respondents from companies using AI say gen AI is already on their boards’ agendas,” the report stated.
Notably, 40 percent of respondents said their organizations will increase their investment in AI overall because of advances in Generative AI. “The organizations that have already embedded AI capabilities have been the first to explore gen AI’s potential, and those seeing the most value from more traditional AI capabilities—a group we call AI high performers—are already outpacing others in their adoption of gen AI tools,” the report added.
How AI is Driving Innovation in India’s Fintech Sector
India has witnessed a significant surge in fintech adoption mainly because of the government’s push for digital financial inclusion, and that a young, tech-literate population have created the ideal conditions for fintech companies to thrive.
AI has emerged as a pivotal tool for companies from digital payments and lending to insurance and wealth management. With the help of AI, fintech companies are now able to extend financial services to remote and underserved regions, facilitate digital payments, automating insurance claims processing, chatbots and virtual assistants, and more.
Companies like Paytm, RazorPay, Lendingkart, among others not only understand the need to invest in AI but are also adopting it for their benefit.
“I am very proud of our Advanced AI capabilities in use and how we are expanding. We are building an India scale AI system which will help various financial institutes in capturing possible risks and frauds, while also protecting them from new kinds of risks due to advancement in AI,” Vijay Shekhar Sharma, Founder and CEO at Paytm said.
The National Payments Corporation of India (NPCI) is planning to integrate BHASHa INterface for India (Bhashini), a government-backed artificial intelligence (AI)-powered translation platform with itself, according to a report by inc42. This will allow users to make conversational payments in Indian languages.
The fusion of fintech and AI is propelling India’s financial services industry to new heights. The support of the government along with regulatory frameworks that encourage innovation, will set the stage for a thriving fintech ecosystem.