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Artificial Intelligence continues to expand the capabilities of cross-border payments
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Artificial Intelligence (AI) is playing a crucial role in improving the efficiency and security of international cross border transactions in the payments industry, according to
Artificial Intelligence (AI) is playing a crucial role in improving the efficiency and security of international cross border transactions in the payments industry, according to Buckzy Payments Inc.
Once regarded as a futuristic technology confined to the realm of films and comic books, AI’s science-fiction reputation has given way to practical usage in a fast-growing range of everyday business processes in the finance industry. This extends to cross-border payments, where AI is already automating processes to speed up transactions, strengthen security and improve the quality of service for customers.
Abdul Naushad, President and CEO of Buckzy Payments first commented on AI’s capabilities in the payments space in January of this year, when he explained its value in reducing human error and instantly calculating credit ratings for customers. But the rapid evolution of AI technology since then means that decision-makers in the payments space are now exploring how AI can help them solve other payment headaches.
Recent research by IBM shows global uptake of AI is becoming more prevalent across all industries, with over a third (35 percent) of businesses reporting its use in 2022 – a four-point increase from the previous year. Another study by Nvidia has found that 37 percent of financial services companies plan to use AI in order to gain a competitive advantage. What’s clear from these figures is how AI has spread across multiple business practices, with fintechs investing time and resources in AI as a means to differentiate themselves from competitors.
According to Nashaud, fintechs that don’t embrace AI and incorporate it across their entire operating strategy risk putting themselves at a significant disadvantage and being left behind by their rivals.
“We already see fintechs implementing AI-based solutions for a range of functions – many are installing AI-powered chatbots on their websites or apps to offer instant, personalised responses to customer queries,” Naushad explained. “But customer expectations are constantly evolving, and efficiency and quality of service are at the top of the list of their demands. Expect, therefore, to see next fintechs leverage AI-based smart speaker technology to enable users to complete transactions verbally on any device, without first needing to dial a number.”
“And in the cross-border payments space, AI is accelerating the resolution of transactions by accurately predicting FX rates,” Nashaud continued. “Predictive analysis can arrive at a predetermined FX rate, meaning transactions can be processed in real-time. Costs remain transparent for all parties involved.”
“AI is set to play an important role in improving the security of transactions,” he added. “Demand for global payments is growing, and with this growth, the risk of an asset or information theft increases. AI’s ability to identify suspicious patterns or irregular behaviour across a payments network enables the swift detection of fraudulent activity. With AI’s help, financial providers can put in place measures that neutralise the threat of fraudsters and keep funds and their customers’ sensitive data safe.”
“AI’s value from a security perspective extends to Anti Money Laundering (AML) screening processes. Financial providers are now developing technology that can verify transactions automatically, which removes the possibility of human error and also reduces processing time, since manual checks are no longer required,”.
Naushad concluded, “AI is now established as an essential component for financial services and the companies that provide them. Companies that downplay AI’s significance will quickly be left behind by more enlightened, forward-thinking competitors who have taken the time and the effort to invest in and integrate AI into both their customer-facing products and services and their back-end systems.”
Artificial Intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think and learn. It is used in various applications, including automating processes in the financial sector.
Cross-border payments are transactions where money is transferred from one country to another. These payments can involve different currencies and often require currency conversion.
Fintech, short for financial technology, refers to the integration of technology into offerings by financial services companies to improve their use of financial services.
Anti Money Laundering (AML) refers to laws and regulations aimed at preventing the illegal generation of income through financial transactions. Financial institutions must comply with AML regulations to detect and report suspicious activities.
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