AI continues to revolutionize the finance industry, with the global FinTech market set to reach $46.8 billion between now and 2030, up from $7.7 billion in 2020. Behind much of this growth is the increased adoption of AI into financial services firms, which benefit from increased efficiency and steep cost savings. Continue reading for a look into some of the biggest AI trends in financial services today.
AI Trends for 2022
Helping financial professionals comb through mountains of data with ease, AI has been a groundbreaking tool for investors. Specifically, sentiment analysis can determine the slant or tone of text data from a variety of sources like social media posts, research reports, quarterly filings and more without manually reading through each piece.
Extracting only the most valuable insights from the constant flow of news stories and company filings, sentiment analysis gives a quantifiable value to qualitative and unstructured data so financial professionals can make quick and informed investment decisions.
Take StockSnips, for instance, which is a start-up that is saving investors valuable time with its powerful sentiment analysis tool. Having analyzed over 10 million articles and counting, StockSnips gives users actionable data from text to identify investment opportunities and predict future stock movements.
Deal Sourcing Platforms
In the private markets, AI is transforming how firms source new deals and find investment targets. Deal sourcing strategies give firms their competitive edge, so having an effective AI tool that filters through databases and qualifies potential targets based on the firm’s criteria can give them the upper hand over competitors and act quickly to make deals.
Taking advantage of recent AI trends in financial services, Grata streamlines the deal sourcing process and has already facilitated over $1 billion in deals. Their platform holds information on over 6 million middle-market companies and lets firms personalize search results to match their investment thesis, compare potential targets and uncover opportunities in the market.
Throughout the industry, one of the major AI trends for 2022 is automating risk management with AI and machine learning. Saving valuable resources that were typically put toward these manual and tedious tasks, firms can dedicate their time to other processes that AI can’t manage, like bettering relationships with clients or discussing strategy.
Risk management performed by AI can prevent potential losses, identifying fraud and unreasonable risk that may have gone undetected since AI can quickly and effectively process large amounts of data in a way that humans cannot. Similarly, the start-up Sharpfin helps asset managers maintain favorable risk levels among their clients and get insights on their holdings and risk exposure in real-time.
Above all, AI is transforming the space and helping financial services firms become more efficient with both time and money. This is a rapidly growing industry, with companies expecting to invest over $110 billion in AI systems by 2024.