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AI in BFSI Market worth over $140 Bn by 2028

  • Published Date: April 4, 2022

AI in BFSI Market size is slated to cross USD 140 billion by 2028, according to a new research report by Global Market Insights Inc.
 

The BFSI sector is leveraging AI technology to gain a competitive edge by implementing the technology to achieve improvements in speed, cost, accuracy, efficiency, and also meet customer needs more comprehensively. The AI in BFSI technology comprises artificial intelligence-based analytics solutions used in financial institutes for customer analytics, forecasting, back-office operation, virtual assistance, and compliance & risk management.
 

Surging demand for augmenting customer experience throughout banking touchpoints

The growing need to offer enhanced customer experience is the major factor driving the AI in BFSI market growth. Growing competition among key players is mounting day by day, pressurizing companies to emphasize on better customer experience for customer retention. This growing competition is enabling financial institutes to integrate advanced analytics tools & solutions to analyze customer data to fulfill their requirement, understand the customer experience, and make smarter predictions on their behavior & requirements. The surging adoption of smart devices and internet services across the globe will also fuel the adoption of AI in BFSI solutions.
 

AI in BFSI Market Size By Application

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Dedicated focus of the financial services industry on providing 24x7 customer support is boosting the chatbot segment demand

The AI in BFSI market from chatbot segment is expected to grow at a CAGR of over 35% through 2028 due to the growing demand to provide better customer experience. Various banks globally are integrating chatbots into their smartphone applications and websites to assist their customers without any delay. The introduction of chatbots in the BFSI sector has improved overall customer engagement and satisfaction. Factors, such as 24/7 availability, immediate query resolving, and up-to-date updates regarding new schemes & programs in the banks, have increased the usage of chatbots in the BFSI industry.
 

Browse key industry insights spread across 300 pages with 419 market data tables and 36 figures & charts from the report, “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, 2022 – 2028” in detail along with the table of contents:
https://www.gminsights.com/industry-analysis/artificial-intelligence-ai-in-bfsi-market

 

Rising need to generate important insights from huge volumes of data

The Natural Language Processing (NLP) segment is likely to hold more than 35% of the AI in BFSI market share by 2028 led by increasing demand to analyze massive digital data across financial institutions. The data from the internet, social media, and personal devices provides financial enterprises with unprecedented opportunities to use digital information and improve their business performance. NLP allows businesses to analyze unstructured data from social media posts, images, emails, text messages, audio files, word documents, PDFs, and other sources that account for over 80% of the data.
 

Profusion of AI technology to automate insurance process

The insurance end-use segment in AI in BFSI market demand is set to witness about 35% growth rate from 2022 to 2028, attributed to the rising demand to automate different processes across the insurance space. Intelligent algorithms are used to create a customer’s risk profile to fasten the cycle time for completing the purchase of an auto, commercial, or life policy as the process will be reduced to minutes or even seconds. Insurance service providers are also leveraging the capabilities of AI in BFSI technology to provide usage-based insurance for the automotive sector.
 

Strict adherence to financial regulations and fair governance practices

The risk management, compliance & security segment is poised to register around 40% gains up to 2028 owing to stringent government regulations to protect financial information. Government authorities are focusing on financial regulations to allow banks and insurance companies to have acceptable risk profiles and avoid large-scale defaults & financial crimes such as fraud and money laundering. The financial institutes must comply with government regulations that require them to know their customers, uphold customer privacy, prevent money laundering, monitor wire transfers, and comply with a stack of additional regulations.
 

The maturing fintech sector and rising investments in financial services across Asia Pacific

The Asia Pacific AI in BFSI market size is predicted to account for nearly USD 30 billion by 2028 impelled by increasing investments in AI technology and increasing digitalization in the region. Increasing investments from tech leaders, such as Alibaba, Baidu, BTA, and Tencent, in AI technology for the BFSI sector will also drive the market revenue. Increasing research & development activities are fueling the adoption of AI in BFSI solutions among several industry sectors. For instance, Toyota is leveraging NLP capabilities to develop self-driving cars. Similarly, Honda also announced its plan to develop a new R&D base in Tokyo specifically for AI.
 

Strategic acquisition is the key market strategy adopted by major industry leaders

Major companies are emphasizing on strategic acquisitions of innovative AI-based start-ups to enhance their AI in BFSI technology capabilities. For instance, in March 2022, RazorPay acquired IZealiant Technologies, a cloud-oriented software provider for financial sector.
 

Key players operating in the AI in BFSI market are Alibaba Group Holding Limited, Amelia US, LLC (IpSoft), ATOS SE, Avaamo, Inc., AWS, Inc., Baidu, Inc., Cape Analytics LLC, CognitiveScale, Inc., ComplyAdvantage (IVXS UK Limited), Digital Reasoning (Smarsh), Google LLC (Alphabet, Inc.), IBM Corporation, Inbenta Technologies, Inc., Intel Corporation, Interactions, LLC, Lexalytics, Inc., Microsoft Corporation, NICE Ltd., Nuance Communications, Inc., NVIDIA Corporation, Oracle Corporation, Palo Alto Networks, Inc., SalesForce.com, Inc., SAP SE, SAS Institute, Inc., and Tencent Holdings Limited.
 

Authors: Preeti Wadhwani, Smriti Loomba

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