Industry leaders highlight AI’s transformative role in enhancing digital security, expanding financial inclusion, and driving innovation across financial services
The financial services sector is undergoing a profound transformation driven by the adoption of artificial intelligence (AI), with industry leaders highlighting its impact on innovation, inclusion, and security. AI is not only reshaping how financial services operate but also expanding access to underserved communities and enhancing the security of digital transactions.
According to Harsh Punjabee, Founder and Chief executive officer (CEO) of SMEST Capital, AI is playing a pivotal role in driving innovation across financial services. “AI is automating processes and generating insights that were previously out of reach,” he noted. For instance, AI algorithms analyse large volumes of market data to predict interest rate changes and assess credit risk, helping investors make informed decisions. These innovations have led to the development of new financial products and more efficient market operations, making AI an essential tool for the industry.
Roshan Shah, Co-founder and CEO of VoloFin, echoed this sentiment, emphasising how AI is streamlining processes like underwriting and risk assessment. “AI enables faster, more accurate decisions, broadening financial access, particularly for underserved sectors like MSMEs,” he explained. Shah further added that AI-driven analytics provide deeper insights into customer behaviour, allowing for the creation of tailored financial products that better meet customer needs.
Enhancing Financial Inclusion
AI’s potential to enhance financial inclusion is a key focus for the industry. Punjabee pointed out that AI can assess creditworthiness using alternative data sources, such as mobile payment histories or social media activity, rather than relying solely on traditional credit scores. “This approach enables underserved individuals to access credit and investment opportunities previously unavailable to them,” he said.
Shah shared a similar perspective, highlighting AI’s role in reducing costs and making financial products more affordable for underserved communities. “AI-driven chatbots and virtual assistants provide 24/7 support in multiple languages, making financial services more accessible to those who may have limited literacy or access to physical branches,” he added.
Sanjay Deshmukh, COO of Findability Sciences, emphasised how AI-powered digital platforms are reaching rural and low-income populations previously excluded from traditional banking. “AI-driven credit scoring models enable more people to access loans and financial products, fostering economic growth and financial empowerment across India,” he said.
Boosting Security Through AI
In the field of security, AI is proving to be a game-changer. Punjabee explained how AI-driven algorithms continuously monitor transactions for signs of fraudulent activity, providing real-time alerts to prevent unauthorised transactions. “Biometric authentication, such as facial recognition and fingerprint scanning, utilises AI to offer secure and convenient access to financial services,” he noted.
Shah highlighted the importance of AI in enhancing fraud detection capabilities. “AI-driven anomaly detection systems monitor transactions around the clock, quickly flagging any suspicious activity for investigation,” he said, adding that this proactive approach builds trust among users.
Deshmukh also stressed the significance of AI in strengthening digital financial transactions. “Advanced machine learning algorithms monitor transactions in real-time, identifying unusual patterns and preventing fraud before it occurs,” he explained. He further added that AI-powered biometric authentication ensures secure access to financial services, building confidence among users.
Broad Adoption and Strategic Investment
AI’s impact on financial inclusion is expected to extend across the entire financial services sector. Punjabee believes that while large corporations may lead the charge, as AI technology becomes more widely available, smaller firms will also adopt these innovations. “This broad adoption will facilitate a more inclusive financial ecosystem,” he said.
Shah agreed, noting that AI-driven financial inclusivity will revolutionise the sector. “AI enables us to streamline complex processes, improve credit assessments, and lower operational costs, making financial services accessible to underserved populations,” he explained.
Deshmukh pointed out that the scalability and adaptability of AI make it essential for reaching diverse demographics across India’s vast landscape. “The entire sector, from banking to insurance, will increasingly adopt AI, driving a more inclusive and widespread financial transformation,” he said.
The significant investments required to leverage AI in financial services must be balanced with potential benefits. Punjabee emphasised that prioritising AI investments in high-impact areas can offset initial costs by improving efficiency and decision-making. Shah added that the security enhancements provided by AI reduce risks, justifying the investment. Deshmukh highlighted Findability Sciences’ ROI calculator, which quantifies the value AI brings in innovation, security, and financial inclusion, ensuring that the benefits justify the costs.
By- Satyam Mishra
