How important is AI to the fintech industry in the Philippines?
- From 2016 to 2021, the valuation of the Philippine Fintech market increased by 224%, from US$3.4 to US$11 billion.
- A Philippine fintech revolution that transforms industries may be sparked by AI and efficient data management with business operations.
Thanks to the COVID 19 pandemic, the Philippines’ fintech industry, which uses technology and other digital tools for financial transactions, has experienced a boost recently. In fact, it has sped up Filipino consumers’ adoption of digital technologies, especially in the fields of e-payments and e-commerce, and a variety of economic operations, including those of micro, small, and medium-sized businesses, are now carried out online.
Since the country first implemented the e-money system, it now has 20 million registered users and more than 63,000 partner businesses that accept e-money payments.
Taking into account how the Philippines is speeding digital payments, the Philippine Fintech market valuation has increased by 224%, from US$3.4 to US$11 billion, between 2016 and 2021. This indicates that at least one fintech service is used by Filipinos every second, making it a necessary component of daily life and business activities. According to the AI-powered decisioning platform Provenir, integrating artificial intelligence (AI) and effective data management with company operations might spark a Philippine Fintech revolution that would change industries.
“The pandemic and its restrictions caused a huge generational spike in the eruption of digital services and has demanded that businesses adapt themselves at a very high speed,” said Provenir General Manager for Asia-Pacific Bharath Vellore.
Organizations are anticipated to start providing financial services to customers in the near future in order to diversify their revenue streams, tailor their customer journey, and enhance the overall user experience. Some of the top companies in the ASEAN and Philippine fintech industries attended the forum “Fintech: A people’s revolution in the Philippines,” which featured this topic.
The future of the fintech industry
The future of fintech, according to Bharath Vellore, APAC General Manager of Provenir, who was present at the forum, is the transformation of any firm into fintech. He claims that AI in Fintech diversifies products and capabilities while opening the door to the digitalization of credit-rich industries. When making individualized offers to customers, agility and speed in customizing are crucial factors that support hypergrowth.
Due to the rapid rate of innovation in the fintech industry, it is becoming increasingly complex to balance being responsible and secure with maintaining the agility and speed of digital transactions for both businesses and consumers.
It was discovered that AI can translate massive volumes of data into valuable insights, such as consumer patterns that aid in fraud detection and corporate risk assessments, as well as how quickly, effectively, and efficiently AI fraud detection works.
According to Vellore, AI helps firms in identifying new data patterns that enable them to reach a larger audience. Not only that, but AI can also save transaction costs, enhance data management, and boost worker productivity.
Super app is more than just a platform
In light of the surge of Fintech solutions catering to varied users, a focus on innovation has been adopted by 77% of financial institutions in order to increase customer retention. Modern mobile app features, such as “frictionless” consumer onboarding through face identification, are ostensibly powered by AI. This technology, however, extends beyond the surface level.
AI can reveal complex and unexpected variables that cannot be gleaned through manual analysis alone. It is said to be able to “advise management on how to use the information in order to maximize profit.”
“Through AI, an e-wallet is no longer just a channel for paying bills but is now also a bank, and it contains your investment portfolio, insurance, and so much more. A ‘super app’,” said Vellore.
Fintech, if implemented properly, has the potential to propel not only the Philippines but the entire ASEAN region into the next stage of digital transformation.
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