AI in BFSI Market Projected to Garner Significant Revenue

The banking, financial services, and insurance (BFSI) sector is shifting from traditional methods to digitalization and deploying artificial intelligence (AI) in mobile banking, cyber security, payments, customer experience, social banking, and branch automation processes for higher operational efficiency. Due to the widening application base of AI technologies in financial institutions, the AI in BFSI market is predicted to demonstrate a CAGR of 37.2% during the forecast period (2019–2024). At this, rate the market value will rise from $3,091.9 million in 2018 to $20,017.9 million in 2024.


Currently, the AI in BFSI market is observing the trend of the usage of advanced AI-based data analytics to improve compliance and deal with fraudulent transactions. Moreover, AI algorithms find application in anti-laundering activities to reduce the time taken. Additionally, features such as AI bots, biometric fraud detection analytics, and digital payment advisers are leading to an expanding customer base and high quality of services. Due to these factors, financial organizations are able to cut their operational costs and supplement their revenue.

The technology segment of the AI in BFSI market is categorized into machine learning (ML), natural language processing (NLP), computer vision, and others. Amongst these, the NLP category is expected to showcase the fastest growth till 2024 due to the increasing utilization of this technology in text mining and back-office operations. Moreover, NLP helps in discovering customer behavior, by analyzing conversations regarding the services delivered by the organization to a customer and monitoring social media activity. Thus, the rising demand for NLP for predicting human behavior and enhancing customer service is adding to the market growth.

The categories under the offering segment of the AI in BFSI market include solution and service. Of these, the solution category dominated the market in 2018 due to the soaring demand for personalized services, increasing requirement for providing users with customized products and analyzing customer behavior, and growing focus on digital banking. Furthermore, the service category is projected to advance faster during the forecast period owing to the escalating demand for training, support, and maintenance services by BFSI organizations using AI.

Geographically, the North American region generated the highest revenue in the global AI in BFSI market in 2018 due to the heavy investments in AI and the fintech sector of the region. Besides, the early adoption of new-age technologies and developed IT infrastructure are fueling the market growth in the continent. AI-based technologies, such as NLP and ML, enable banks to better understand the customer behavior and offer personalized user experiences. With the presence of some of the largest financial institutions in the region, the market prospects here remain robust.

The Asia-Pacific (APAC) AI in BFSI market is expected to register the fastest growth during the forecast period due to the rising demand for personalized customer services and rapid digitization. In the APAC region, the banking and financial organizations of India and China will adopt AI technologies for multiple applications. This is why key players, such as Salesforce.com Inc., Microsoft Corporation, IBM Corporation, and Oracle Corporation, are expected to increase their AI offerings for the BFSI sector of China and India.

Thus, the increasing penetration of the internet and digitalization of banks and financial organizations will stimulate the market growth globally.

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