Artificial Intelligence (AI) in Fintech Market Forecasts to 2028 – Global Analysis By Place of Deployment (Front Office, Back Office), Application (Quantitative, Fraud Detection), End User (Retail Banking, Hedge Funds) and By Geography

Artificial Intelligence (AI) in Fintech Market Forecasts to 2028 – Global Analysis By Place of Deployment (Front Office, Back Office), Application (Quantitative, Fraud Detection), End User (Retail Banking, Hedge Funds) and By Geography

According to Stratistics MRC, the Global Artificial Intelligence (AI) in Fintech Market is accounted for $8,218.01 million in 2021 and is expected to reach $32,681.16 million by 2028 growing at a CAGR of 21.8% during the forecast period. AI in Fintech gets better results by applying techniques derived from aspects of Human Intelligence at a beyond human scale. The computational arms race for past years has revolutionized the Fintech companies. AI and machine learning have gained banks and fintech as they can develop huge amounts of information about customers. This data and information are then compared to obtain results about suitable services/products that customers want, which has aided, effectively, in developing customer relations.

Market Dynamics:

Driver:

Focus of companies on cost reduction and improving efficiency

Artificial Intelligence in fintech is allowing companies to cut down their cost, automate their process and reduce the chances of error. AI Chatbots are used by companies as customer assistants for various purposes such as sales, customer care executive (over phone), and online chat executive. AI is empowering small finance companies as it is affordable as well as chances of error occurrence is very low. In addition, the insightful details about the cash flow and income and expense are gaining the traction from the end user as this helps companies to reduce their expenses.

Restraint:

Concerns regarding data privacy

The biggest challenge with AI is the sensitive issue of data privacy and security, which most fintech companies are facing. The fintech sector is governed by strict compliance to regulations and governance since any data breach or security failure could be disastrous. Privacy concerns are cropping up as companies feed more and more consumer and vendor data into advanced, AI-fuelled algorithms to create new bits of sensitive information, unbeknownst to affected consumers and employees. This is especially prevalent in the retail banking sector, where consumer data collection has been at the forefront in terms of big data challenges. These data privacy concerns will hinder the adoption of AI especially in banking sector.

Opportunity:

New technological advancements

One of the biggest cybercrimes is credit card fraud. Thus, companies are designing a new generation of algorithms that are Convolutional Neural Networks and are based on the visual cortex, which is a small segment of cells that are sensitive to specific regions of the visual field in the human body. This means that they are able to extract elementary visual features like oriented edges, end-points and corners. This technology can study the spending data of an individual and be able to determine, based on this information, whether they performed the most recent transaction on their credit card or if someone else was using their credit card data.

Threat:

Increased number of regulations

The increasing number of multiple regulatory compliances will create hindrances for the growth of the market. Also, lack of skilled consultants to develop artificial intelligence in fintech will narrow down the scope of growth for the market. Further, suspension of business activity on account of the coronavirus pandemic will yet again create hindrances.

The quantitative and asset management segment is expected to have the highest CAGR during the forecast period

The quantitative and asset management segment is growing at the highest CAGR in the market. This is mainly because AI is changing the asset management sector by allowing fundamental analysts to conduct a large number of researches and extract more information quickly, allowing them to discover accurate investing ideas. Moreover, the financial institutions have invested a significant proportion of amount in AI solutions and services for quantitative and asset management, to optimize data management in a better way.

Region with highest share:

North America is projected to hold the largest share in the market. The region has also registered the maximum adoption of AI in Fintech solutions, due to the strong economy, robust presence of prominent AI software and system suppliers, and combined investment by government and private organizations for the development and growth of R&D activities.

Region with highest CAGR:

The Asia Pacific is projected to have the highest CAGR due to the growing economy, increasing investments in IT infrastructure, rising adoption of new technologies, and surging government initiatives toward the development and deployment of IoT and AI technologies in companies operating across several verticals in the region. Moreover, major players, as a part of their business strategy, are investing in the untapped markets of the region, which, in turn, is contributing to the regional market growth.

Key players in the market:

Some of the key players profiled in the Artificial Intelligence (AI) in Fintech Market include Ripple Labs Inc., Active.Ai, TIBCO Software (Alpine Data Labs), Trifacta Software Inc., Data Minr Inc., Zeitgold GmbH, Sift Science Inc., Pefin Holdings LLC, Betterment Holdings, WealthFront Inc., Intel Corporation, Sentifi AG, ComplyAdvantage.com, Narrative Science, Amazon Web Services Inc., IPsoft Inc., Next IT Corporation, Microsoft Corporation, Onfido, and IBM Corporation.

Key developments:

In May 2020: Sentifi AG announced the expanded alternative data-based analytics to surface investment opportunities and manage risks. Sentifi’s new analytics solution includes detection of the sector, industry outliers, ESG events with potential asset valuation impact, and investment themes trending real-time while offering investors the ability to detect outliers within their portfolio. Investors can assess portfolio sentiment performance to the custom benchmark and quickly identify significant market events and impacted sectors, industries, and assets.

In April 2020: Verient System INC, Next IT Corporation's parent company, reached an agreement with one of the world's largest banking organizations to provide its new standard solution for fraud and corporate security investigations. The Variant Systems Al platform assists the bank in detecting fraud, as well as in meeting cybersecurity and deployment management requirements.

Place of Deployments Covered:
• Front Office
• Back Office

Components Covered:
• Hardware
• Services
• Solutions

Deployments Covered:
• On-Premise
• Cloud

Machine Learning Applications Covered:
• Deep Learning
• Machine Vision
• Natural Language Processing
• Reinforced Learning
• Semi-Supervised Learning
• Supervised Learning
• Unsupervised Learning

Applications Covered:
• Business Analytics and Reporting
• Virtual Assistants (Chatbots)
• Customer Behavioural Analytics
• Risk Investigation
• Quantitative and Asset Management
• Fraud Detection
• Know Your Customer (KYC)
• Accounting
• Customer Service
• Peer-to-Peer (P2P) Lending
• Insurance Support
• Network Security
• Capital Markets
• Other Applications

End Users Covered:
• Retail Banking
• Hedge Funds
• Stock Trading Firms
• Investment Banking

Regions Covered:
• North America
US
Canada
Mexico
• Europe
Germany
UK
Italy
France
Spain
Rest of Europe
• Asia Pacific
Japan
China
India
Australia
New Zealand
South Korea
Rest of Asia Pacific
• South America
Argentina
Brazil
Chile
Rest of South America
• Middle East & Africa
Saudi Arabia
UAE
Qatar
South Africa
Rest of Middle East & Africa

What our report offers:
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements

Free Customization Offerings:
All the customers of this report will be entitled to receive one of the following free customization options:
• Company Profiling
Comprehensive profiling of additional market players (up to 3)
SWOT Analysis of key players (up to 3)
• Regional Segmentation
Market estimations, Forecasts and CAGR of any prominent country as per the client's interest (Note: Depends on feasibility check)
• Competitive Benchmarking
Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances