RAISE 2020: AI to expand scope of financial services in the country, say experts
Artificial intelligence (AI) is expected to play a key role for the financial services industry as the huge amount of digital data that is generated continuously has provided fintech platforms to understand consumers better. Today, technology will define how financial transactions will be carried out.
Delivering the keynote address on the second day of the five-day global virtual summit Responsible AI for Social Empowerment (RAISE) 2020 on the topic, 'Data and AI powered financial services', Manipal Global Education Chairman T V Mohandas Pai said, “The potential for fintech is enormous in our country and AI will be the differentiator.”
Organised by the Ministry of Electronics and Information Technology in partnership with NITI Aayog, RAISE 2020 was inaugurated on October 5 by Prime Minister Narendra Modi who called for India to be a global hub for AI.
The fast adoption of AI by the financial services industry has led to newer innovation where the existing players are going through a disruption with new-age fintech startups coming out with completely new business models.
Pai pointed out that country already has the third largest fintech ecosystem across the globe and the foundations have been laid in terms of extending the reach of financial services through technology. Pai noted,
“Covid-19 has not slowed down fintech industry but now it is getting more mainstream.”
The existing technology infrastructure like UPI, Aadhar, and the upcoming account aggregator system is expected to take the financial services industry to the next level.
Pai pointed out how various trends like growth in daily volume of digital data, increased computing power, lower storage costs, and rising number of internet connections is all leading to deeper interaction of AI with the financial services industry, especially for a developing economy like India.
“Artificial intelligence and machine learning is expected to bring about $34 billion savings globally by 2025,” said Pai.
He felt that banking system in the country will turn into a service leveraging AI and allow this sector to reach out to greater number of customers who are not part of a formal economy.
According to Pai, the four pillars of AI adoption in the country are: data, talent, AI companies, and government policies. Though he cautioned that the country was not producing enough number of PhDs in the area of AI and there was also the flight of talent to developed economies.
Krishnan Dharmarajan, Executive Director of the Centre for Digital Financial Inclusion, stressed how AI can be leveraged to get the scale and reach in order to reach those sections of the population which do not come under the formal banking channels.
He felt the banking system can leverage AI not just to enable financial transactions but also become the channel through which the welfare schemes of the government for the disadvantaged sections of the society are delivered.
The speakers at the summit also highlighted how AI can be leveraged to combat frauds in the financial sector. Today, digital cash is gaining increased traction and AI could become the technology vehicle through which such payments are further extended.
Edited by Dipti Nair