We may encounter numerous of AI-based financial solutions in today’s modern era. If you face data theft attempts, then you will receive a login alert notification on your phone, this is one of the ways AI works.
AI, or artificial intelligence, has drastically changed the financial industry in recent years. AI has become a solution for both individuals and companies to optimize their finances in a more optimal and efficient way.
What is AI?
AI, or Artificial Intelligence, is a computer system technology that is capable of important tasks that require human intelligence. AI works by relying on machine learning, deep learning, computer vision, and natural language processing.
With that technology, AI can undertake data analysis, recognize patterns, and make decisions quickly and efficiently autonomously. AI capabilities can even outperform human abilities in some aspects.
So it’s no surprise that AI is beginning to be implemented in all industries that require precision, speed, and accuracy, such as the financial industry.
AI-based financial solution
The current financial industry can’t be separated from Artificial Intelligence (AI). Many financial problems need speed to be precisely and accurately solved. Here are the benefits felt in the financial industry because of AI technology.
1. AI accelerates data analysis
One of the benefits of implementing AI technology in the financial industry is the capacity to analyze financial data more rapidly and accurately. AI can extract critical information from large amounts of data in seconds
Doing it manually with only human ability will take hours. A company can make better and more effective financial decisions if data is analyzed quickly and accurately.
2. Assist in a more precise decision making
With the help of AI, decisions can be made based on a more in-depth analysis of historical and current data. AI can identify thousands or even millions of patterns that humans cannot see.
The benefits of AI enable companies to make more precise decisions, particularly when it comes to long-term financial plans.
3. Minimize risk
The implementation of AI as a financial solution can aid in risk management. AI can identify a wide range of possible risks, including credit risk, market risk, and operational risk.
By identifying those risks early on, a company as a user can take preventative measures more swiftly and precisely, reducing errors in decision-making.
4. Increase operational activity efficiency
AI implementation certainly increases efficiency in terms of operations. Many time-consuming tasks, like invoice processing, inventory management, and routine financial analysis, can be automated using AI.
An example of implementing AI as a financial solution
We already know of the numerous advantages of AI as a financial solution. So what is an example of its application?
1. AI in personal finance
AI technology is important not only for large corporations but also for individuals managing their personal finances. Many smart financial apps that use AI have successfully assisted individuals in monitoring their income and outcomes.
AI often delivers the best recommendations for planning and investing based on individual risk profiles.
2. AI in the banking industry
The banking industry has implemented AI in a variety of operational aspects. In general, they used AI technology to detect fraud, conduct credit analysis, provide reports, and develop products.
3. AI in business
Various micro-to large-scale enterprises are currently utilizing AI in their financial management, for example, various automatic financial record systems such as Fintelite’s OCR+ .
OCR+ is a system that converts physical documents such as receipts and invoices into editable digital data.
Financial transaction data entered into OCR+ can also be processed automatically based on category without requiring a lot of human labor.
4. AI in investment management
AI can assist the process of investment management companies in predicting market movements and identifying promising investment opportunities. AI often used to aid investors in investment decisions by doing in-depth analyses of stocks, bonds, and other financial instruments.
Data privacy is an AI challenge in the financial industry
Although AI-based financial solutions promise numerous benefits, there is one challenge that must be considered, which is the issue of data privacy. Users of AI technology must take anticipatory actions to overcome this challenge, such as not relying solely on AI for automation but also involving human resources for checking and oversight.
