It is forecast that the artificial intelligence (AI) market will hit US$360 billion by the year 2028, according to The Payments Association.
The forecast was included in The Payments Association’s recent survey, entitled ‘Using AI Intelligently: Smart ways to use artificial intelligence in Payments’, which outlined how AI and machine learning are being used in the payments, finance and banking sectors and how they may be used in the future.
The research shows how interest and uptake in AI was slow but steady pre-COVID 19, but following the pandemic, interest increased dramatically as financial organisations sought ways to become more efficient. This, in turn, caused a rise in regulatory interest in AI to mitigate risks relating to privacy, unlawful discrimination, and security.
The report, supported by Fable Fintech, an international payments company, shows that the majority of financial services organisations with over 5,000 employees are using some form of AI.
The report also found that 70 per cent of all financial services firms are using machine learning to predict cash flow events, fine-tune credit scores and detect fraud, while 54 per cent of financial services organisations with more than 5,000 employees have adopted AI.
Reflecting the need for added security in payments, the survey also found that 92 per cent of consumers expect a fast, frictionless experience while also getting one that is as trustworthy and secure as possible.
The report also stressed that the transformative impact of AI on the finance sector is only just beginning. One estimate puts the potential value of AI in finance at $1 trillion annually, but this could be the “tip of the iceberg”, the Payment Association said, when it is considered how much AI will improve in the future.
Tony Craddock, director general at The Payments Association, comments: “We knew that AI was transforming the payments industry, but from talking to figures within the industry about their own experience with AI we have seen that they are moving from using AI in distinct siloed processes to having it be a core technology driving their business.”
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