The expansion of the global AI in banking market is being driven by an increase in investment by banking organizations in AI and machine learning, as well as an increase in consumer preference for personalized financial services.
Increased investment in AI and machine learning by banking businesses, elevated preference for personalized financial services, and the rise in collaboration between financial institutions and AI & machine learning solution companies support the growth of the global AI in banking market. On the other hand, the increased implementation costs of AI and machine learning, as well as a deficit if skilled workers, limit expansion to some extent. Yet, a rise in government initiatives and increased investments in AI technology are projected to generate profitable prospects in the business.
The COVID-19 outbreak is expected to have a beneficial effect on the growth of AI in the banking market. This is because to the increased demand for anti-money laundering (AML) and fraud detection systems during the pandemic. Simultaneously, with the huge rise in digitization among both financial institutions and end users, the demand for AI technology has surged in order to minimize the strain on banking servers, consequently relieving transaction delays during this unprecedented period.
In terms of solution type, the Customer Relationship Management (CRM) segment dominated in 2020, accounting for approximately one-fifth of the global AI in banking market. During the forecast period, the same segment is expected to have the fastest CAGR of 34.0%. The growing need for CRM solutions to obtain deeper insights into customers’ habits and personal preferences is driving category growth.
In terms of technology, the machine learning and deep learning sector provided the lion’s share in 2020, accounting for over one-third of the global AI in banking business. However, the same sector is predicted to have the highest CAGR of 33.5% between 2021 and 2030. This is due to a rise in the use of machine learning by banking institutions to support artificial intelligence software developed by various organizations to enhance their bias judgements while doing vital tasks.
North America dominated the market by region in 2020, accounting for more than two-fifths of the global AI in banking market, owing to a growth in demand for advanced analytics in the area. At the same time, the Asia-Pacific region is predicted to have the quickest CAGR of 34.3% during the forecast period. This is due to increased investment in loan sanction practices by banks in China, Japan, and India.
The industry’s key players –
- BigML, Inc.
- Cisco Systems, Inc.
- Fair Isaac Corporation
- SAP SE
- Hewlett Packard Enterprise Development LP
- SAS Institute Inc.
- International Business Machines Corporation
- Amazon Web Services Inc.
- Microsoft Corporation
- RapidMiner, Inc.
Information from PR Newswire