Fintech and NBFC
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Artificial Intelligence (AI) is a paradigm-shifting technology that has changed the way business and industries operate. Finance is no exception. Rapid innovation is on a rise as AI in finance encompasses everything from virtual chatbot assistants to fraud detection and task automation.
Technologies defining a new paradigm for FinTechs and NBFC
As the regulations for NBFCs have become stricter, they are now focusing on niche
markets and developing innovative products using AI and ML catering to middle-class urban customers. From designing, launching, and implantation of new products to lead
generation, customer onboarding, underwriting, credit/loan disbursement and collection, these new-age technologies can be adapted across the entire value chain of NBFC ecosystem.
AI can use customer behaviour data and explainer variables, such as unsubscription to newsletters and mailings, number of times statements have been downloaded, and other indicators of churn behaviour to compile a list of clients who show signs of considering cancelling their policy. The manager can then reach out to these clients
with personal attention and help address the issue
Increasing ‘Borrower Base’ Among No/Thin-file Segments
Growing borrower pool among new-gen who have little to no credit history. Companies can use an AI-based loan approval workﬂow to ﬁnd the user eligible for a loan among people in the 19-35 age group. By analyzing their current debt record, education, assets, and other records, AI can help ﬁnance companies increase their customer base signiﬁcantly.
Contract analysis is a repetitive internal task that involves a lot of manpower in the ﬁnance industry. However, with new AI software applications, Optical Character
Recognition can be used to digitize hard copies of documents and then a NLP model can be used to create contracts accurately and with high speed.
FinTechs have been creating a strong buzz across the global ﬁnancial space because of its potential to disrupt the traditional banking system. FinTechs are using AI to improve operational eﬃciencies and overcome business challenges. Some of the common uses of AI and ML are for alternative credit models, fraud detection, enterprise automation for accounting, treasury, regulatory compliance, and reconciliation for traditional NBFCs.