Wondering what’s in store for FinTech in 2020? M&A and Capital Markets Practice Leader and KROST’s Technology Industry group leader Paren Knadjian offers insight into FinTech trends to watch for in the coming year.
“The use of Artificial Intelligence (AI), Machine Learning (ML), and Natural Language Processing (NLP) will have the same level of impact in the financial services sector as automation and robotics has had in manufacturing, resulting in similar downward trends in the use of human resources (and therefore employment). This phenomenon will be most publicly felt amongst the larger, more traditional financial services companies. The adoption of AI has already begun. One example is Erica – Bank of America’s AI-powered chatbot that already has more than 6 million users – out of the total of 25 million customers that use the BofA mobile app. Erica combines predictive analytics and NLP to help users access balance information, transfer money between accounts, send money with Zelle, and schedule meetings at financial centers. Customers can interact with Erica through voice commands, texting, or by selecting options on the app. Meanwhile, Canada’s Manulife is using AI for its underwriting services and has announced a four-year partnership with the Waterloo Artificial Intelligence Institute at the University of Waterloo and launched a conversational AI solution with FinTech firm Kasisto. They have also been announcing restructurings and some layoffs – not directly as a result of their investment in AI but as part of a clear trend of using technology to improve efficiency. Consumers and businesses are demanding more rapid, less rigid, less bureaucratic and more transparent services from their financial services providers. 2020 will see more innovation in the use of AI and ML by commercial banks, investment service providers, insurance companies and tax and accounting services providers.”
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