Artificial intelligence (AI) has assumed a growing influence within financial services in recent years, affecting areas such as credit decisions, risk management, fraud detection, and stress testing. And for many fintechs, it has been baked into the process from the outset, to the extent that usage of AI in the fintech market registered $6 billion in 2019 and is expected to reach $22 billion by 2025. Economic fallout from the pandemic, however, has accelerated the timetable for financial services firms to become mass adopters of AI and harness its predictive powers sooner rather than later. For digitally native fintechs, many of which have already embraced AI and its capabilities, this offers the opportunity to invest further in the technology and capitalise on the tools available to accelerate their journeys. Fintechs across the world are dealing with the effects of Covid-19 and face an uphill challenge in containing the impact of it on the financial system and broader economy. With rising unemployment and stagnated economies, individuals and companies are struggling with debt, while the world in general is awash in credit risk.
The COVID-19 pandemic is not just a health crisis, but a socio-economic crisis as well. The global economy is projected to decline sharply this year, owing to the disruptions in global markets and value chains. The pandemic-triggered global economic recession will likely be the deepest one in advanced economies since World War II and the first output contraction in emerging and developing economies in at least the past six decades, according to the World Bank's latest Global Economic Prospects report. COVID-19-related confinement measures such as nationwide lockdowns, travel bans, border closures, and social distancing have impacted every individual and organization, regardless of its size, in one way or the other. Overall, the crisis has changed the way we socialize, work, learn, and perform basic day-to-day activities.
The world of finance is changing. Since the financial crash in 2008, there has been a slow but steady move away from traditional finance models, as the value of embedding deeper approaches to social and environmental issues has become increasingly clear. Now, the world has taken a shocking blow from the COVID-19 pandemic. The tragic deaths, lost livelihoods, and curtailed freedoms are unprecedented, and no-one can tell how or when the global economy will recover from a downturn of this speed and scale. As we tackle one of the biggest global crises of our time, and look to rebuild in a way that ensures we emerge from this stronger and more resilient, sustainable finance – in other words, finance that takes account of positive and negative social and environmental factors, particularly the factors that tend to play out over the medium to long-term – will be more critical than ever.
Artificial Intelligence help, Even before Covid-19, Pakistan was dealing with multi-pronged crises, ranging from the economy to health, and digital rights. The pandemic, however, has significantly exacerbated the crises. Artificial Intelligence help, The precipitously rising problems have, in turn, given rise to global calls for similarly urgent solutions. In a world, where social distancing has become a basic necessity to fight the pandemic, digitization is an integral part of any solutions. Artificial Intelligence (AI) and big data have been its vanguards.
The COVID-19 crisis highlighted and amplified the gap between what consumers expect their financial institution to provide and what many traditional financial institutions were able to deliver. Many financial institutions were not prepared to open new accounts without a visit to the branch, and even more organizations could not facilitate small business Paycheck Protection Program (PPP) loans without significant friction. Some institutions even struggled with personalization of messages and adjustments to policies related to direct deposit of benefit checks. The good news is that many organizations have worked overtime to fix many of the customer facing issues related to digital banking capabilities and have given indications that back-office initiatives have increased in priority since the COVID-19 shutdown. With organizations in all industries working to provide hyper-personalized digital experiences, there has never been a more dramatic call to action than what has occurred during this pandemic.