The COVID pandemic has thrown us for a loop. The ups and downs of the economy over the past year, not to mention the volatile nature of the job market, have put personal finance at top of mind for many of us. Fortunately, there is a wide range of tools available to help us budget, save, and plan for the future. Every day, financial organizations and institutions hire developers to create solutions to assist with the creation of new and different platforms.
One of the technologies they are increasingly leveraging is AI for a variety of innovations, including money-related tools. That’s because artificial intelligence has the power to completely transform banking and finance, making many of our everyday money-related hassles more straightforward and easier to navigate.
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Security is a pivotal aspect of banking. Where your personal finance is concerned, you need to be able to trust that your transactions are private and that your personal information is secure. And AI is playing a central role in protecting you.
One way AI can assist with cybersecurity is by detecting patterns that could indicate fraud. Have you ever gotten alerts from your credit card company saying they noticed unusual activity — an irregular purchase, an odd location, or an abnormally high amount of money spent — in your account? That’s AI at work, spotting strange activities the human eye can’t see or that would take up a lot of time for a person to check.
Financial institutions are always looking for ways to engage their customers and make them part of the personal finance process. AI makes the consumer experience more appealing through plenty of different tools.
AI tools can serve as personal assistants, offering advice based on the users’ habits, financial history, and other information. Particularly sophisticated assistants have the intelligence to communicate with customers and deliver advanced suggestions as good as or even better than what you can hear from a human counterpart.
Helping you budget, warning you when you’re spending too much, and managing your bills are just some of the activities they can handle on your behalf.
Chatbots and Constant Communication
Thanks to AI, you can be in constant communication with your financial institution 24/7 — there’s no need to wait for your branch to open and operate during business hours. AI-powered chatbots, for example, can work with you to resolve issues with your account, review your activity, answer questions, check your balance, make payments, and much more. This also frees up humans to deal with more complex matters.
Are you a novice when it comes to investing? Don’t worry. Robo-investors also called Robo-advisors, help you manage risk and make sound investments. You don’t even need to be closely involved in the process — these tools will make investments on your behalf based on combining data like your personal financial information and your plans for the future.
Like financial assistants, financial managers work with you to help you manage your money. But they go a step further. Rather than simply alerting you about your spending and money-related matters, they collect information and data about your finances to show you an overview of your activities and inform your decisions, such as how much money you can spend, how much you can invest, where you can save, and so on. This allows you to make smarter and more beneficial decisions with your money.
Accessibility is a huge concern when it comes to personal finance. Fortunately, today, many financial institutions and businesses are making strides to enable users with disabilities and impairments or those in underserved areas or lower economic brackets to get the tools and support they need. And AI is playing a huge role in this.
For example, there are more and more accessible ATMs that are voice-activated. These ATMs are ideal for people with visual impairments — they incorporate speech-recognition software to make it much easier for these individuals to complete their transactions without actually having to see the screen.
Another way of reaching underserved populations is by giving people who haven’t built their credit history access to loans. Zest AI, for instance, is an underwriting tool that helps borrowers who lack credit information secure loans. Using the platform, which incorporates AI to delve into borrowers’ other information, companies can access the risk of loaning to these individuals more accurately. It also offers greater objectivity than humans normally might.
Gaining control over your money and managing it competently is pivotal to our livelihood, health, personal life, welfare, and happiness. And thanks to AI, more and more people have the tools they need to make sound decisions about their personal finance.
But these are just some of the ways this important innovation has completely revolutionized the personal finance landscape. Fintech is hard at work creating new ways to help individuals handle their income and make informed choices about how to handle their money.