What was once just a fantasy of some famous science fiction writers, Artificial Intelligence is now taking root in our everyday lives. It has been around for many years now, but recently it’s been widely spread and radically facing a lot of changes and advances, making it of crucial interest for many fintech start-ups and organisations.
What is Artificial Intelligence?
Artificial intelligence, or AI, is simply the simulation of human intelligence processes, using machines. It is the development of the machine’s ability to imitate the human mind and the way it works, such as its ability to think, discover and learn from previous experiences. An easy example is the program used in the computer chess games. This game is programmed on all types of moves and reactions to the players. The program is constantly learning and developing itself. So, you can never win doing the same move twice, cause it learns and stores the information just like humans.
Contrary to certain beliefs, artificial intelligence is more of the ability to think and analyze data than it is about a specific job. Although artificial intelligence in movies often serves the narrative of machines becoming human-like that seek to destroy humanity and take control over the world, it is never intended to replace humans. AI’s main goal is to significantly enhance human capabilities and contributions, improve the quality of work, which is an asset of great value to any business.
Economic Impacts of AI
Down below are among the major findings of the impact of AI on the economy in the upcoming years:
Governments’ reliance on artificial intelligence in decision-making will lead to an increase in global economic output, with an increase ranging between $13 trillion and $15 trillion by 2030.
It will also contribute to supporting the Middle East economy by about 320 billion dollars in 2030, which is equivalent to 11% of the GDP, especially in the UAE; It is expected to represent 13.6% of its GDP by 2030.
The contribution of artificial intelligence to the gross domestic product of Saudi Arabia is 12.4%, and in Egypt it is 7.7%.
In a report issued by the Ministers Information Center, he said that about 70% of companies will use at least one of the artificial intelligence technologies, and it is expected that the global spending of companies on artificial intelligence will reach $110 billion annually by 2024.
AI in fintech
Global investments in the financial technology sector have achieved very rapid growth in recent years. For banks, financial technology has pushed them to innovate and provide better and faster services in order to maintain the importance of the role they play, and for consumers, financial technology means providing a wider field for obtaining better services.
As for the uses of artificial intelligence in the banking sector, they are many and varied, especially in financial technology, which relies heavily on artificial intelligence. Examples on that are mobile applications, blockchain, market operations, pricing, risk management, intelligent interaction with the customers, studying the local interest market, detecting fraud, estimating the customers’ credit ability, and determining the risks & prices of insurance contracts according to complex algorithms.
Among the most prominent global examples of AI in banking operations is the use of robots by the Santander Bank in Spain, since 2010, to deal with customers in a customer center. In addition to UBS Bank Amazon’s digital assistant, Alexa, that’s used to serve customers. The Dutch bank ABN Amro is also using a large-scale AI network that includes a digital assistant for clients, fraud detection tools and risk analysis management.