The pandemic has set the wheels of paperless banking in motion, especially in the middle-east. So much so, that people are readily accepting branchless, paperless swipes without having to imagine queuing up at the banks for anything small or big. This adoption of contactless payments and banking continues to redefine the industry — as we transition into the new year and perhaps, the second post-covid era.

Well, that calls for a lot more attention on improving customer experience on one end and strengthening online identity verification, digital onboarding, and fraud prevention on the other – for the banks and financial institutions. We need a much stronger digital ecosystem. How do we achieve that?

In order for the banking and financial institutions to drive and transition through the rapidly changing environments, there is a need to combine innovation, technology, and domain expertise. Before helping you find the right people who could achieve this for you, let us take a quick dive into what this changing landscape expects you to understand.

Access to credit has been a problem for both individuals and businesses. Although there are many traditional ways to apply for credit, for example, banks and other financial institutions. But not all of them provide credit to all kinds of users. If they provide, they have strict requirements.

That’s when these users apply for credit through different platforms. Mobile Money Providers, for instance. Mobile Money Providers or MMPs are the companies or lenders who provide credit through the mobile platform.

Yes, it is possible to borrow money from mobiles. Due to its ease of use and wide availability, mobiles have become the most popular medium to have access to easy credit for users.

Identity theft happens when someone steals your personal information without your permission. There are 20 types of identity theft including tax identity, shopping, debit or credit card, and so on. Biometric data is most difficult to breach by hackers. And that’s why it is recommended to conduct biometric authentication by every financial institution.

Using AI in a financial business can reduce losses by 23%. That’s the impact of AI! It has affected almost every industry since its inception. From traveling to online learning, everything is powered by Artificial intelligence today. The most significant impact of AI can be seen in the microfinance industry. 

AI has revolutionized the microfinance industry and some of the positive changes that came into effect are as follows:

• Detailed credit assessment – Gone are the days when traditional credit assessment was part of lending solutions. With the advanced implementation of AI in the microfinance sector, it can be done quickly and way more efficiently. Apart from checking the credit history and credit score, AI is also capable of checking other potential factors including utility bill payments, social media behavior, and more.

• Risk analysis and management – AI runs extensive research to analyze a profile. This research is often essential for a microfinance company to run a risk analysis. Implementing machine learning algorithms can make sure risk cases are identified at the early stages.

• Enhanced customer experience – This is one of the most important criteria for a microfinance company as their business is dependent on their customers. If the entire lending process is fast and effortless, chances are, a microfinance platform will have recurring as well as new happy customers every day.

• Automation – Think about automation through machine learning. Microfinance is no exception. Leading financial firms worldwide use machine learning or AI implementation to automate their processes. AI introduces automation in every level of the loan process including loan origination, loan servicing, and loan collection. It is helpful in saving time as well as cost as opposed to using the traditional methods or workforce.

• Helpful in battling fraud – AI has given the microfinance industry a robust fraud detection as well as a prevention system. By using machine learning or artificial intelligence some of the most serious financial frauds can be prevented, for example, money laundering. Apart from reducing frauds AI also helps in reducing the investigation costs up to 20%.

The telecommunication industry is going through a massive transformation phase of development, mainly to equip itself per the latest technological demands and customer needs. While this has given the industry a lot of opportunities, the telecos around the globe are facing a lot of challenges. Moreover, to gain a competitive edge, they need to emphasize providing personalized solutions to their customers.

The success of a lending service depends primarily on its ability to assess the creditworthiness of borrowers. It is a key component in the lending process. When assessing counterparty risk, two key factors come into play – accuracy and time.

When done manually, the process of collating and analyzing borrower information can be error-prone and time-consuming. This affects the operational efficiency of the lender, as it may take days or even weeks to accurately perform the financial spreading and risk grading of the applicants.

In view of the progressively growing momentum of digital transformation, the finance industry is quickly realizing the power of technology and the immense potential of its applications in this segment.

The need for automated solutions has been felt for long in the financial industry, as it can not only help streamline the credit assessment process but can also help scale loan application processing volumes. Technology can also significantly enhance the level of accuracy of lending decisions.

In the credit sector, which is characterized by complex manual processes or cumbersome legacy systems, the targeted introduction and integration of state-of-the-art technologies allows Fintech enterprises to secure enormous benefits. Organizations can use the latest technologies to boost efficiency, deliver improved customer experience, and stay relevant in a fiercely competitive market.