AI for Finance Industry: Advantage and Disadvantage
Artificial Intelligence [AI] is now being applied in different sectors that have increased their productivity. AI is now also changing the working model of the financial services industry drastically. It is giving benefits for both the customers and the financial industries too. AI for finance industry is giving new opportunities for the financial service industries with which they can increase their profits. There are many advantages of AI for finance industries which have made increased their growth exponentially.
AI has changed the perspective of the financial industries to better utilize the insights of the data, innovate the new business model to increase the business efficiency, implement the new dynamics, etc. As there are many benefits of AI to finance industries, there are a few disadvantages too. We will look at both the advantages and disadvantages of AI in the finance industry.
What are the advantages of AI for finance?
1. Better insight into financial data
AI can provide a better insight into the financial data to the finance company. It will help them to plan a constructive approach that can benefit them and their customers.
2. Work faster
As AI works on a real-time basis, it works faster than the normal manual processes. The earlier manual processes would take some duration to consider different aspects while taking the decision. Automating as per the requirement can give the result and predictions in a few seconds. Here, the complex decision can also be taken with much ease.
3. Incur lesser cost
AI implementation decreases the requirement for human experts in the work. This makes it cheaper for doing the necessary work along with making important decisions for the management. The company just needs to make a required algorithm that can help them to get the desired work done easily.
4. Meeting the compliance and eliminating fraud in the process
Meeting compliance as per the regulations is one of the top priorities for any financial industry. Failing to comply with it can lead to monetary fines, a shutdown of specific operations, risk of volatility in the process, etc. AI here can help to meet compliance and eliminate fraud in the process. It can work as per the criteria given in the algorithm.
5. Handle large data
One of the wonderful benefits of AI to finance industry is its ability to handle large data. At a time, it can handle large data which supersedes the manual process tremendously.
What are the disadvantages of the AI for finance industry?
1. Implementing the proper algorithm
Although the AI works flawlessly with faster results, its accuracy depends on the algorithm it works on. An improper algorithm or command can bring unnecessary errors and wrong results. So, proper implementation of the algorithm is important.
As we have seen the multiple benefits of AI for the financial industry, it has a relevant high cost too. It may not be possible for all the finance companies to go for this big expensive model initially.
There are some of the advantages and disadvantages of the AI for finance industry. A reputable company can give a better AI solution for the finance company which can help them to implement the process better.
Meru Accounting provides excellent service of AI for the finance industry. Meru Accounting is a popular accounting service providing agencies across the world.