How Artificial Intelligence is enabling financial inclusion in India
From automated loans to providing better user experience, fintech companies in India are using the power of technology and Artificial Intelligence innovation to fill the gap left behind by the traditional banking sector.
Across the globe, Artificial Intelligence (AI) is stirring up a lot of excitement among organisations. In the FinTech sector, AI has demonstrated potential to make the availability of financial services to everyone in a better, faster, and cheaper manner.
After making an entry into India in the past decade, AI is now causing a big boom, and the technology is finding use in a wide range of applications. Let’s see how AI is contributing to making financial inclusion a reality in the country.
According to studies*, the Indian FinTech market is expected to grow at a CAGR of 22 percent over the next five years, with the transaction value crossing $73 billion by 2020. Moreover, with over half a billion people in the country having access to the Internet, it is posing a great opportunity for the fintech industry.
Financial services are impacting more than 300 million users by enabling them access to credit, while the same users are completely ignored by traditional players due to insufficient credit history.
There are quite a few challenges in the Indian fintech market – India is a country with many languages, habits, cultures, and preferences. Fintech is relevant to each of the 1.3 billion people in the country, and therefore the interfaces developed for the user interaction should be versatile, easy to understand, and transact.
Keeping this in mind, developing that one service that provides a suitable or desirable user experience to everyone across the country is very important. A key aspect that can make this happen is AI. As fintech grows, all companies involved in this space needs to reinvent the scale, speed, and accuracy of distribution of services.
So, what is AI? For starters, AI is about automating the logic implied by humans in a process.
For example, if a fintech product is relevant to the working population in India, then technology is applied to dissect this data from a large data set and utilise the desired information.
Similarly, most fintech companies no longer interact with users through a human representative to ascertain their creditworthiness. The scores or worthiness is automatically determined through the information fed by the user on the platform.
Some of the ways in which AI is being used in FinTech include:
1.The process of analysing risk and approving a loan is now automated using AI and takes only a few minutes instead of a few days.
