Optimisation of AI Adoption in Fintech
The integration of Artificial Intelligence (AI) in the financial technology (fintech) sector is on an unstoppable trajectory. However, there are several critical issues, including legal, educational, and technological challenges, that must be addressed to ensure its effective implementation, as outlined in Fintech News. Despite these challenges, various factors are driving the increased adoption of AI in the fintech industry.
Shlomit Labin, VP of Data Science at Shield, highlighted the unique challenges that the vast amounts of data generated by society pose to financial institutions. Shield specializes in assisting banks, trading organizations, and other firms in monitoring for risks such as market abuse, employee conduct, and compliance issues.
One of the major challenges faced by financial services firms is the overwhelming volume of communications that need to be assessed, which far exceeds human capacity. Recent regulatory changes have further exacerbated this issue, making traditional methods like random sampling insufficient in today’s environment.
Eric Robinson, VP of Global Advisory Services and Strategic Client Solutions at KLDiscovery, emphasized the impracticality of using traditional linear data management models in handling the exploding volumes of data. He highlighted the necessity of leveraging AI in various processes, moving AI from a luxury to a necessity in the industry.
The adoption of AI-based compliance technologies is relatively new, and skepticism remains among some, including judges, who have questioned the use of AI in core litigation and e-discovery. However, as technology evolves, AI-based tools for compliance are continuously improving in quality and gaining acceptance across industries.
Regulatory pressures have played a dual role in both posing challenges and driving advancements in AI. While regulators expect more from organizations, lawyers, and technologists, the younger generation’s comfort with AI is paving the way for its increased adoption.
Despite the advancements, there are still significant challenges to address, such as confidentiality, bias, and ensuring the accuracy of AI tools. However, by combining AI with other technologies and human expertise, organizations can create more effective and efficient solutions.
AI is increasingly becoming an indispensable tool in the fintech industry. As technology continues to evolve, AI will play a crucial role in enhancing various aspects of financial services, from compliance to fraud detection, providing valuable insights and improving decision-making processes.