Machine learning in the fintech sector is gaining popularity. And, if your career goal is to become a fintech expert, then you must be aware of what machine learning is and how it's affecting the sector. Most financial institutions today are in favour of investing in machine learning and consider the two an ideal match. Did you know that a Forbes survey has found that as high as 70% of financial institutions use machine learning these days to detect fraudulent incidents or adjust credit scores? If you're interested, then jump into this article that is all about the importance of machine learning in fintech and get a clear understanding of the field. Read on to find more.
Machine Learning: What is it?
In layman's terms, machine learning is a field which explores the capacity of a machine to mimic the intelligence of humans without any specific programming. It is based on statistical techniques which are used for building intelligent computer networks. It is most commonly used in the detection of fraud, filtering spam, detecting malware threats, etc.
Is Machine Learning The Same as Artificial Intelligence?
Although the two might sound similar, they are not the same. There is a thin line of difference because machine learning falls within artificial intelligence, it is the subset of the latter. While AI or artificial intelligence helps a machine to replicate human behaviour, machine learning aids a computer system to learn automatically from previous data sets without any need for explicit programming.
How to Pair Fintech With Machine Learning?
The fintech sector is associated with a vast customer base with an ocean of data, which is related to the fluctuations in the market and along with it the sector also faces continuous threats of illegal activity. Tracking down such a massive threat manually is next to impossible, and this is where machine learning comes in as a saviour. It mostly involves the identification of patterns, which it can identify from a vast number of sequences in only a matter of seconds. Machine learning is also equipped with pattern prediction, which helps most businesses to explore new opportunities and find out the most suitable strategies.
What Are The Benefits of Coupling Machine Learning And Fintech?
Smart solutions have long invaded the fintech market and the following are their benefits:
- Greater cost efficiency, because with automated processes, staff requirement automatically becomes less
- Greater customer engagement with more personalised choices and options. This makes sure customers feel more involved in the offered products
- Against manual search for illegal activities in any financial institution, machine learning works in a jiffy. Thus, the coupling offers greater time management
- Machine learning algorithms help financial institutions in better risk assessment before the institutions can guarantee any payback in case of losses
What Are The Uses of Machine Learning in Fintech?
Given below are the top uses of machine learning in the fintech sector:
This strategy of machine learning is used by many financial institutions for decision making and increasing their trade volume. For instance, the company 8topuz makes use of machine learning to help its investors boom their wealth.
As mentioned earlier, machine learning helps in fraud detection with its feature of finding patterns from an array of data sets in a matter of seconds. For instance, renowned company Capgemini has claimed that with the help of machine learning, the time required for fraud detection went down by 70%.
Enhanced customer service
In terms of finance, it is the accuracy and transparency of the institution which are highly valued by any customer. Machine learning is equipped with features like analysing customer data and predicting on the basis of analysed data. For instance, Wells Fargo launched a machine learning-driven customer chatbot service for Facebook Messenger.
Why Should I Learn About Fintech And Machine Learning?
Is your goal to be a financial expert? Then you must already be aware of the growing importance of machine learning in this field. However, simply having the knowledge doesn't suffice and you need to have a relevant academic degree to prove your worth to your potential employers. You can opt for a postgraduate diploma after graduation, such as the postgraduate diploma in management offered by Imarticus in partnership with Birla Institute of Management Technology.
Machine learning in the fintech sector is much like a brain that hardly ever gets tired of working. It is always starving for more data that it can process. No doubt the pairing of fintech with machine learning is a new one and it has more to achieve, yet we can already hope that the coupling will offer more refined services in future. Fintech executives with an MBA degree earn handsome salaries in our country. So, hope you’re all set to kickstart your fintech career!