Presented in New Directions in AI

1. AI APPLICATIONS IN
BANKING AND
FINANCIAL SECTORS
By,
Vaibhav R

2. Agenda
■ Introduction
■ AI Applications in Banking Sector
■ AI Applications in Financial Sector
■ Conclusion

3. Introduction
■ Artificial intelligence in the banking sector makes banks efficient, trustworthy,
helpful, and more understanding. It is strengthening the competitive edge of modern
banks in this digital era. The growing impact of artificial intelligence in the banking
sector minimizes operational costs, improves customer support and process
automation.
■ Besides, AI in banking also helps users to select loan amounts at an attractive
interest rate. The AI technology in the banking sector allows banks to update
processes automatically and work under existing regulatory compliance.
■ Let’s have a look into what AI can do for the banking sector.

4. 1. AI Chatbots
It is one of the significant use cases of AI in banking.
AI-powered chatbots are modernizing the way how
businesses provide services to their customers.
Chatbots helping customers in many ways.
They can assist customers by responding to their
doubts. These chatbots provide a personalized
experience to users. As customers are using mobile
apps to avail banking services, the banking sector is
integrating Chatbot services to attract customer
attention and expand the brand in the market.

5. 2. Enhancing Customer Experience
■ AI banking apps can do wonders.
■ The intelligent mobile apps can track
user behavior and provide valuable
personalized suggestions to them.
■ In addition, users can do unlimited
transactions from their
smartphones.
■ Secondly, AI-powered banking apps
will show services, offers, and
insights based on user search
patterns.

6. 3. Brings automation and makes the
process seamless
■ Artificial intelligence has great potential in the
banking industry.
■ It automates every task which is done by humans
and makes the entire process simple.
■ Simple, AI can reduce the workload in banks.
■ AI automation in banking reduces the workload
of an employee.
■ It can serve the customer’s 24*7.
■ Through customized banking apps and Chatbot,
users can get complete information on opening
or closing the account or transfer of funds, etc.

7. 4. Data collection and analysis
■ Artificial intelligence-based
applications can efficiently perform
data collection and analysis
process.
■ Verified data sets are essential to AI-
machines to analyze the data.
■ AI-powered mobile banking apps
collect and create a suitable
learning procedure for enhancing
the overall user experience.
■ After a proper analysis of the data,
the user experience can become
more personalized.

8. 5. Portfolio and wealth management
■ Wealth and portfolio management can be done more
powerfully with Use Cases of AI in the Banking Sector.
■ When the user does an online transaction, AI technology
sends notifications instantly to the users.
■ If any suspicious transaction occurred, the AI machines
immediately alert the user. Hence, AI offers safe
transactions.
■ On the other hand, AI is also used for the card
management system. It can automate the credit and debit
card management system and also makes the process
safer.
■ Artificial intelligence makes the transactions safe and
secure. Hence, AI systems advance mobile banking
services.

9. 6. Risk Management Functions
■ It is one of the most essential factors in the banking industry.
■ For instance, disbursing loans is a bit complicated task for
bankers.
■ It needs to maintain the confidentiality of user sensitive data
while disbursing the amount.
■ Moreover, knowing the financial status of borrowers is also
required while giving loans.
■ Artificial intelligence can do this task with more accuracy and
privacy. AI-based mobile banking applications easily track the
financial activities and analyze the banking data of the
borrower.
■ This could help bankers to identify the risks in giving loans to
them. In addition, using the AI-driven risk assessment process,
bankers can analyze the borrower behavior, and thus can
reduce the possibility of fraudulent acts.

10. 7. Analyze the mood or sentiments
■ Artificial intelligence models in
banking are using to analyze the
mood of countless financial markets.
■ Using machine learning techniques,
AI-models can predict the market
conditions and provide insights into
the market trends.
■ Because of this reason, artificial
intelligence models are using in
hedge fund management functions.
■ Using market trends predicted by AI-
models, investors can make valuable
financial decisions quickly.

11. 8. Next-gen security is guaranteed
■ Artificial intelligence provides
high-level security services to
banks.
■ Mobile app development
companies with their expertise
are developing AI banking apps
to make every transaction safer
and quicker.

12. 9. AI mobile apps detects Fraud
■ Artificial intelligence banking apps detect risks and minimize fraudulent acts.
■ AI technology can scan the transactional data and detect irregular user behaviour patterns.
■ Hence, using smart AI tools and apps, banking companies can protect their business from
breaches.

13. 10. AI for Compliance in Banking
■ Artificial intelligence technology is spreading at a rapid pace.
The biggest organizations look at banks that follow
regulatory compliance rules.
■ The banking sector needs to continuously update its work
processes under the existing compliance rules and
regulations.
■ Generally, most banks maintain an internal compliance
team for this purpose. The compliance teams clean
webpages and other internal documents to stay updated
with the new rules. But, this process takes a lot of time and
needs more capital to do manually.
■ Artificial intelligence-based software products can actively
find the rules that apply to the banks and make them
compliant with those rules. AI software boosts the skills of a
compliance officer and allows them to scale their
operations.

14. Impact of AI in the Banking Sector
■ Cuts Operational Cost
■ Improves Customer Support
■ Picks creditworthy clients to disburse loans
■ AI helps banks run under regulatory
compliance

15. AI APPLICATIONS IN
FINANCIAL SECTOR

16. 1. Financial Advisory Services
■ As the pressure increases on financial institutions
to reduce their rates of commission on individual
investments, machines may do what humans
don’t- work for a single down payment.
■ Another evolving field is bionic advisory, which
combines machine calculations and human insight
to provide options that are much more efficient
than what their individual components provide
Collaboration is key.
■ It is not enough to look at a machine as an
accessory, or on the other end, as an insufferable
know-it-all.
■ An excellent balance and the ability to look at AI as
a component in decision-making that is as
important as the human viewpoint is the future of
financial decision-making.

17. 2. Trading
■ Investment companies have been relying on
computers and data scientists to determine future
patterns in the market.
■ As a domain, trading and investments depend on
the ability to predict the future accurately.
■ Machines are great at this because they can crunch
a huge amount of data in a short while.
■ Machines can also be taught to observe patterns in
past data and predict how these patterns might
repeat in the future.
■ AI can suggest portfolio solutions to meet each
person’s demand. So a person with a high-risk
appetite can count on AI for decisions on when to
buy, hold and sell stock.

18. 3. Managing Finance
■ Managing finances in this well-connected and
the materialistic world can be a challenging task
for so many of us, as we look further into the
future we can see AI helping us to manage our
finances.
■ PFM (personal financial management) is one of
the recent developments on the AI-based wallet.
■ Wallet, a San Francisco based startup, uses AI to
builds algorithms to help the consumers make
smart decisions about their money when they
are spending it.
■ The idea behind the wallet is very simple it just
accumulates all the data from your web footprint
and creates your spending graph.
■ Thus it has to be the preferred personal financial
management in order to save time from making
lengthy spreadsheets or writing on a piece of
paper.

19. Conclusion
■ From a small-scale investment to a large scale investment AI commits to be a
watchdog of future for managing finances.
■ Without a speck of doubt, AI is the future for the banking and finance industry.
■ Since the speed at which it is making progressive steps towards making the banking
and financial processes easier for the customers, it is very soon going to replace
humans and provide faster and much more efficient solutions.
■ Bots are gradually evolving as innovations are being in the AI sector.
■ Massive investments are being made by the firms who are seeing this as a long-term
cost-cutting investment.
■ It helps the companies in saving money of hiring humans and also avoiding human
errors in this process.
■ Though it is still in its nascent stage the speed at which it is progressing to evolve
the finance sector, it can be well expected that the prospects are going to lead to
minor losses, smarter trading and of course top-notch customer experience.