The Banking, Financial Services, and Insurance (BFSI) industry is at the forefront of AI adoption, and the technology is mainly being used for revolutionizing customer experience and operational processes, an IDS study has found. With a surge in investment, BFSI firms are leveraging next-generation AI technologies to personalize customer interactions, enhance security measures, and streamline operations, thus setting a new standard for industry innovation.
How BFSI is Driving Innovation Through AI
The study has found that the sector is at the forefront as far as AI adoption is concerned, and the technology is being used to:
- BFSI industry leads in AI spending, transforming customer engagement and operational processes.
- Next-gen AI technologies personalize customer experiences, leveraging geolocation and spending patterns.
- Deeper client engagement, improved customer experience, and reduced attrition are key outcomes.
Also read: India’s AI Growth Fueled by Talent Growth and Continued Investment in AI Ecosystem
Key AI Investment Use Cases
Some of the common use cases that have emerged from the BFSI sector as far as usage of AI is concerned are:
- Augmented fraud analysis and investigation.
- Program advisors and recommendation systems.
- Automated threat intelligence and prevention systems.
- GenAI applications for audio, text, image, and video.
Going forward, some of the strategic investments goals would be for:
- Enhancing operational efficiency.
- Elevating customer experience.
- Boosting employee productivity.
Trends Witnessed for Asia Pacific BFSI Industry AI Adoption
Through strategic AI investment, the BFSI sector is poised to redefine customer engagement, operational excellence, and industry benchmarks, shaping the future of finance and insurance services. Some of the common trends witnessed are as follows:
- Automating lending, onboarding, KYC, and account opening processes with artificial intelligence and machine learning.
- Reduced errors, improved productivity, and enhanced satisfaction.
- Significant cost savings and efficiency gains.
What IDC predicts for the BFSI Sector’s AI Adoption
The study says that by the year 2028, real-time sentiment analytics will drive 33% growth in customer loyalty and retention. In addition to this, the integration of artificial intelligence and machine learning into industrial operations is expected to increase efficiency and reduce downtime by 10%. Furthermore, 50 percent of top 100 banks will offer hyper-personalization of customer rewards and loyalty programs by the year 2026.
AI Spending Trends in Asia Pacific for the Sector
IDC has suggested that there would be continuous investments into AI as a technology to drive innovation and competitive edge in the BFSI sector. Also, AI spending is projected to soar from $3,293.9 million in 2023 to $8,566.5 million in 2027. Those who wish to read the report are advised to visit the official link for further information.
