There is no doubt that the FinTech industry is one that consistently evolves and reaches heights that no-one ever thought were possible. The industry’s consistent growth over the past few years has clearly transformed traditional methods of doing business and has, for example, moved banking into a more innovative, technologically efficient, and advanced space. Digital or virtual banks, going cashless, biometric, and cyber-security technologies are becoming more and more common.
As FinTech advances, more creative and ground-breaking innovations will continue to generate exciting trends in the market. While the spectrum of innovations is broad, one of the main developments that have captured the most attention is Artificial Intelligence (AI). There are many elements of AI in the use of the financial industry. For example, AI Chatbot technology, which aims to emulate human behavior to enable client interface capability to perform in a more intelligent and human-like way; AI trading technology, which aims to study the market, learn from large quantities of data, adapt to the progressive market environment and advance customers’ accounts on a consistent basis; Client Relationship Management AI is also prevalent in the market. CRM AI takes form as a strategic software that enables companies to track down their customers, and in doing so, they can plan their sales and marketing strategies as well as retain loyal customers which will result in increased profits and growth.
Great examples of AI-based FinTech solutions include Israeli FinTech innovations, all part of the ever-growing Israeli FinTech ecosystem and members of the Israeli FinTech Association.
Case Study #1:
Optimove has developed a “Science-first Relationship Marketing Hub” by combining the science of data collection and interpretation with the art of marketing to assist marketers in delivering personalized, real-time, multichannel marketing campaigns. This enables marketers to maximize customer engagement, loyalty, and value. Optimove has created a thriving market for marketers in all financial industries, which has created opportunities for a smoother transition to the AI revolution.
Case Study #2:
I Know First uses AI technology to create algorithmic forecasting solutions for capital markets to discover the most favorable investment opportunities. The underlying technology of this algorithm is based on AI and machine learning by initiating daily market predictions for stocks, ETFs, interest rates, currencies, and world indices for all time horizons.
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I Know First is an innovative and fast-growing FinTech company that reflects how AI has opened up markets in the banking, hedge fund, and financial institution sectors.
FinCom is the first automated anti-money-laundering/ KYC (Know Your Client) screening system which has been developed for effective compliance. This company has developed cross-language, unstructured database unification technology, using AI and Advanced Phonetic Mathematics. This is a useful example of how AI in the FinTech and Cyber Security sector is growing, thereby creating effective and efficient systems to counter illegal activities such as money-laundering, the financing of terrorism and the use of the proceeds of crime.
All three of these Israeli startups are a great reflection of the tremendous fast-growing trends AI technology which will continue to permeate most industries. The Israeli FinTech ecosystem is growing vastly and is seen to be the “State of AI” as they are a prominent tech house for AI-based innovations. But Israel-based AI solutions are not solely in the FinTech space; there are more than 1000 companies that are centered on pursuing and specializing in AI in the fields of Cyber Security, automotive, healthcare, and others. Israel’s success in the FinTech and AI fields is a result of outstanding training in computer science and big data faculties in higher education institutions as well as the training within the specific units that the IDF grant to their soldiers.
The AI revolution has clearly begun, and those industries that choose to embrace the opportunities created by these technologies will benefit from the cost and time-saving efficiencies created thereby. With consumers being bombarded with so much more choice in the market, those businesses that use AI to provide innovative and effective services or solutions will no doubt leave their competitors lagging far behind.
Nir Netzer is the Founding Partner of Equitech Financial Consulting and Co-Founder of the FinTech-Aviv community.