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Artificial Intelligence (AI) in BFSI Market Size By Component (Solution [Chatbot, Customer Behavior Analytics, Customer Relationship Management (CRM), Data Analytics & Visualization, Fraud Detection], Service [Professional Service, Managed Service]), By Technology (Machine Learning, Natural Language Processing (NLP), Computer Vision), By Application (Back Office/Operation, Customer Service, Financial Advisory, Risk Management, Compliance & Security), By End-use (Bank, Insurance, Wealth Management), COVID-19 Impact Analysis, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2023 – 2032

  • Report ID: GMI2605
  • Published Date: Feb 2023
  • Report Format: PDF

Industry Drivers

Artificial Intelligence in BFSI Market size valued at USD 20 billion in 2022 and is expected to exhibit a CAGR of 20% from 2023 to 2032, owing to increasing investments toward implementing AI solutions and services in the BFSI sector.
 

Artificial Intelligence in BFSI Market

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Global investments in the fintech sector grew by over 68% in 2021 compared to 2020. Digital enterprises and tech leaders such as Google, Amazon, and Apple are at the forefront of such technological investments. According to a Bank of England survey, in 2022, entities are likely to be interested in investing in AI for both medium and long term. Thus, the increasing acceptance of AI technologies, coupled with advanced financial analytics and ML, has led to massive investments in the development of AI technologies to improve financial operations and enhance user experience.

Data security and safety concerns to hinder product adoption

Banking professionals claim that privacy and security issues are the major barriers to the adoption of AI technologies. Financial institutions are more vulnerable to cyber threats since AI platforms and solutions analyze customer data to derive useful insights that help businesses make decisions and streamline their operations. Data security for deep learning and machine learning algorithms is a key challenge. However, mounting government efforts to implement AI-specific legislation and appoint dedicated AI regulators to oversee AI ethical and security threats are foreseen to counter these limitations in the upcoming period.
 

Digitalization of financial services to bolster AI solutions uptake across the BSFI sector

In terms of components, the artificial intelligence in BFSI market share from the solution segment is estimated to witness over 15% CAGR through 2032. Ongoing efforts by financial institutions to integrate AI solutions in order to digitalize their operations through smoother customer interactions, better legal compliance, and reduced fraud, along with the introduction of AI solutions in the BFSI sector. For instance, in June 2022, Kiya.ai, a developer of innovative digital solutions for financial institutions and governments, globally launched India's first-ever Banking Metaverse dubbed ‘Kiyaverse’.
 

Burgeoning digital data across financial institutions to foster data analytics & visualization segment growth

AI in BFSI Market Share, by Solution

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Under solution, the artificial intelligence (AI) in BFSI market from data analytics & visualization segment is anticipated to record significant growth during the forecast timeline, attributed to the proliferation of digital data across financial institutes caused by the increasing usage of digital banking services. Furthermore, the segment growth is likely to be fueled by cutting-edge competition, and prominent risks that are urging banks and other financial institutions to constantly innovate and differentiate by shifting from "customer-focused" to "customer-centric" business models.
 

Soaring application of machine learning for process automation to boost the market progression

The artificial intelligence (AI) in BFSI market from the machine learning segment accounted for 40% revenue share in 2022. Widespread application of ML technology for various use cases, including robo-advising, market impact analysis, financial monitoring, risk management, and process automation. Additionally, this technology benefits banks and financial institutions by accelerating the underwriting process, portfolio composition & optimization, and model validation, which is speculated to positively influence the industry landscape.
 

AI integration for personalized banking services to favor customer service segment growth

Authors: Preeti Wadhwani, Smriti Loomba

Frequently Asked Questions (FAQ) :

The market of AI in BFSI was worth more than USD 20 billion in 2022 and is anticipated to depict over 20% CAGR through 2032 resulting from increasing investments to implement AI solutions and services in the BFSI sector.

The customer service segment is projected to generate more than USD 60 billion in revenue by 2032 driven by the hyper-personalization of user experiences through the integration of AI technology into products and services, including intelligent voice and chatbots, which streamlines communication with customers.

Europe is projected to account for more than 25% of the market revenue by 2032, attributed to favorable government regulations that are encouraging the adoption of AI solutions and digitalization in a variety of sectors.

ATOS SE, AWS Inc., Cape Analytics LLC, Google LLC (Alphabet, Inc.), IBM Corporation, Lexalytics, Inc., Intel Corporation, Microsoft Corporation, NVIDIA Corporation, Palo Alto Networks, Inc., and Tencent Holdings Limited are some of the major industry participants operating in the market.

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Premium Report Details

  • Base Year: 2022
  • Companies covered: 25
  • Tables & Figures: 446
  • Countries covered: 19
  • Pages: 300

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