Read pt 1. of this three part blog series HERE.
FinTech Product Development in the Financial Services Marketplace
Product development makes up a significant portion of the financial services marketplace.
As mentioned earlier, digital payments make up one of the largest FinTech segments in today’s product market. This has led to much of FinTech product development being centered around the development and implementation of payment services and solutions.
This focus on payment services is important to note, as it has a substantial influence on how FinTech product development is optimized.
For instance, mobile accessibility has become a major consumer demand, with more than two billion consumers using mobile payments and mobile payment transaction volume reaching a value of $1.7 billion in 2021 alone, according to an October 2022 report from Business of Apps.
In terms of how AI and ML come into play in this type of product development, these technologies offer financial service providers key capabilities that can enhance both the product and customer experience.
These capabilities include:
- Improving the speed and efficiency of payment processing
- Reducing the time spent on fraud detection
- Boosting accuracy and precision of transactions
- Managing and analyzing larger amounts of data, specifically when looking for irregularities
- Utilizing machine learning and natural language processing (NPL) to assess customer documentation, such as Know Your Customer (KYC) documentation
- Providing customers with personalized chatbots that offer tailored advice and task assistance
All of these capabilities and feature enhancements are for mobile payments alone.
So, for just a moment, consider the expansive range of use cases for AI in product development for products beyond mobile payment solutions. AI can help financial service providers optimize and enhance a whole host of products, from regulatory compliance models to personalized investment tools.
The key to using AI and ML in product development is to understand both the advantages and shortcomings of the technology. While many financial service providers look at AI as the end-all-be-all of improving business functions, strides are still being made to improve the technology’s user-friendliness and overall ease of application and implementation.
This is one reason why focusing on the use of AI in product development can be beneficial. Rather than spreading the technology thin to try and optimize all aspects of a business, AI can be leveraged to drive product value higher through improved user experiences and more powerful data capabilities.
Stay tuned for Part 3 of Artificial Intelligence in FinTech: How AI & Machine Learning Can Solve Key Challenges where we will discuss the state of AI and ML in 2022 and moving forward.