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AI Impact in 2024: Predictions By INZMO, Toqio, Midaxo, DECTA, Alveo, Infosys Finacle, BlueFlame, Tax Systems

It’s a time of reflection and anticipation at The Fintech Times throughout December, as we look back at developments and trends over the last 12 months and forward to the year ahead.

We’re pleased to share the thoughts of fintech CEOs and industry leaders from across the globe to 2023’s key takeaways and what we should expect to be top of the agenda in 2024.

Today we hear from industry experts on the growing impact of AI across various sectors and industries, highlighting its potential for transformation, efficiency improvement and enhanced customer experiences in 2024.

AI and insurance
Meeri Savolainen, co-founder and CEO at INZMO
Meeri Savolainen, co-founder and CEO at INZMO

“Over the last year, AI and machine learning have played a pivotal role in transforming fintech processes,” says Meeri Savolainen, founder and CEO at Berlin insurtech INZMO.

“From an insurtech perspective – this has included streamlining fraud prevention processes and enhancements in the claims handling process even during emergency situations and natural disasters like hurricanes.

“2024 will see a continuation of this with the fintech landscape poised for further transformation thanks to the ubiquitous adoption of AI and machine learning, and with the technology promising an even more customer-centric and efficient future.

“2024 will also see a ‘war for talent,’ particularly for AI trainers, AI engineers and AI analysts and will also usher in new shifts in job functions. Expect to see a host of new AI associated roles all focused on navigating the evolving fintech terrain and maximising the technology to help deliver on new and innovative services.

“We should also expect to see the regulatory organisations working in parallel, adapting to the new risks introduced by the emerging technologies and creating new standards in order to keep companies compliant and to safeguard customers. As such, ongoing and open communication between startups and regulators is crucial to ensure a balance between innovation and compliance.”

AI and payments
Scott Dawson
Scott Dawson, co-founder and CEO, DECTA

Scott Dawson, head of sales and strategic partnerships of DECTA, a provider of end-to-end payment infrastructure, looks at AI’s impact on the payments landscape.

“The industry has had an interesting year, with many organisations feeling the impact of economic and political events globally, from high costs and even higher inflation rates to low consumption.

“AI is the one standout topic in 2023 that got everyone talking and while the basis of the technology has been around for many years, it was in 2023 that it really took off and became a household term, and that is in large part thanks to ChatGPT, which celebrates its first anniversary at the end of the year.

“The current craze for AI comes from generative AIs – systems like ChatGPT and Midijourney that allow users to prompt a system to create realistic-seeming writing or images – and there are currently limited applications for this particular technology for many businesses. Few organisations are losing money because they can’t create enough written content – their pain points come from high costs, high inflation rates and low consumption, which AI is not able to address.

“There is huge potential in automation, as we have seen in the payments industry, but as with many advancements they are unlikely to be flashy, and the real progress will happen through automating time-intensive processes rather than deploying sci-fi style artificial general intelligence. As with so many things, we need to get serious about increasing productivity through building upon the AI systems that have been producing value for years rather than chasing a moonshot.”

AI and customer experience
Martijn Groot is VP Strategy at Alveo
Martijn Groot is VP Strategy at Alveo

Financial services firms will make growing use of generative AI to enhance the customer experience, says Martijn Groot, VP strategy at financial data management SaaS provider Alveo.

“In 2024, the financial services industry will witness a profound transformation in client interactions, driven by the continued rapid adoption of generative AI and large language models that drive interaction via chat as well as voice and video.

“These technologies will become integral components of customer service platforms, evolving from traditional call centres to more sophisticated AI-driven systems where AI agents will field most inquiries.

“This transition will not only enhance the client experience by providing more human-like interactions before they connect with a real person, but also optimise operational efficiency by reducing the need for human intervention in routine enquiries.

“Financial institutions will invest significantly in training their AI models to understand and respond to a wide array of customer needs, ensuring that the technology is not just a novelty, but a true enhancement to customer service.

This will require a substantial amount of data and metadata management to ensure that the AI systems have access to up-to-date, accurate, and relevant information. As a result, there will be a heightened focus on data governance and compliance to ensure that all interactions are conducted in a secure and ethical manner. After all, you can’t have advanced analytics or generative AI without good data.”

AI and banks
John Barber, vice president of Infosys Finacle Europe.
John Barber, vice president of Infosys Finacle Europe

The primary learning from 2023 is that generative AI is bringing in a paradigm shift in how banks embrace AI, according to John Barber, vice president of Infosys Finacle Europe.

“In the banking industry where you have vast troves of data, diverse customer-facing roles, and ongoing digital evolution, banking leaders have a unique opportunity to harness gen AI’s immense potential.

“But there is also an inherent understanding that tech advancements like these need robust ethical frameworks and meticulous oversight to navigate. Many banks have had noteworthy pilots. For example, you have JPMorgan Chase creating a gen AI-powered service, which will provide investment guidance and personalised selection of securities for customers.

“In another instance, following extensive testing involving 1,000 financial advisers over several months, Morgan Stanley has been preparing to launch a generative AI-powered chatbot — the bot will provide valuable insights and administrative assistance to financial advisers.

“While the results from banks’ use of this technology have been impressive and will no doubt spur others on to implement it, there remains a level of trepidation to move too fast. In 2024, the banking sector is poised to unlock the transformative capabilities of gen AI in customer engagement, sales and marketing, and software engineering. The integration of automation, AI, and generative technologies is set to shape the industry’s trajectory, offering a future in which banks can provide unparalleled innovation and value to customers.”

AI and the alternative investment industry
Raj Bakhru, CEO of BlueFlame,
Raj Bakhru, CEO of BlueFlame

Raj Bakhru, CEO of BlueFlame, the generative AI platform for alternative investment managers, suggests generative AI will have a significant impact on the alternative investment industry in 2024.

“AI was experimented with in 2023 but the industry had not yet set clearly defined objectives, pre-identified use cases and coherent strategies. That will change in 2024 as the industry shifts towards ‘productionising’ AI, with a pointed focus on deployments that deliver the most benefit for fund managers and help them obtain the highest ROI on integrating AI into their day-to-day activities and existing workflows.

“We’ll see fund managers turn to AI to enhance portfolio research, refine risk management strategies and automate routine but crucial tasks such as Due Diligence Questionnaires (DDQs) and RFP responses. Private equity firms will harness the content search capabilities for better diligence and research, while private credit will use it to aggregate covenants from credit agreements and hedge funds will leverage it to aggregate sell-side reports.

“AI use will become a key competitive differentiator from both a bottom line and recruitment perspective. Limited partners and top talent will increasingly look to work with firms that demonstrate they can effectively harness the power of AI to prioritise productivity and derive tangible efficiency gains and front-office time savings.

“Firms will also realise they must embrace effective change management and staff training to drive smooth AI integration and maximum value, and ensure any deployment is done in a secure and compliant way.”

AI and accounting
Russell Gammon, chief solutions officer at Tax Systems
Russell Gammon, chief solutions officer at Tax Systems

“2023 has undoubtedly been the era of generative AI for tax and finance, as well as the whole world,” comments Russell Gammon, chief solutions officer at Tax Systems, the tax software supplier to accountancy firms and corporates.

“But it’s still in its infancy, and 2024 will be the year that we start to properly utilise it – and reap the full benefits. ChatGPT will go from being a fun toy to play around with, to the foundation of business applications and products.

“We have already seen businesses enhance existing products with AI but over the next 12 months we will see it add real commercial value as whole new products are built upon the technology.

“In finance and accounting, this will involve generative AI taking over large parts of mundane admin tasks. Without the burden of spending hours on data entry and analysis, tax professionals can simply review the outcomes and apply their tax knowledge to the data set.

Focusing on these higher value roles not only increases efficiency and productivity, but it also improves job satisfaction. It allows junior team members to use the skills and knowledge that they have gained throughout years of studying and training, and subsequently makes tax a more enticing career for the graduates of today. The rise of the ‘AI co-worker’ will be the key trend of 2024.”

AI and mergers and acquisitions (M&A)
Jude McColgan, CEO of productivity platform Midaxo
Jude McColgan, CEO, Midaxo

Jude McColgan, CEO of productivity platform Midaxo, shares his thoughts on the impact of AI on M&A technologies.

“Research shows companies using acquisitions as an active element of their growth strategy outperform companies relying solely on organic growth by 3.8 times,” says McColgan. “The most successful acquisition-based growth strategy is programmatic, acquiring two or more smaller companies per year using structured, repeatable M&A processes.

“M&A work management platforms are taking centre stage for their ability to standardise end-to-end processes, centralise documents and communications, collaborate across the extended M&A team, and enable end-to-end visibility and reporting. These platforms have delivered major improvements across the entire M&A process. They will become even more powerful over the coming year by leveraging AI, with the potential to dramatically reshape corporate dealmaking.

“Artificial Intelligence is poised to transform M&A, enabling teams to identify better deals, conduct faster and more insightful due diligence, and ensure full value realisation during post-merger integration. Teams can already benefit from AI in M&A processes using solutions such as those for contract reviews. Users can already begin reaping the next-level, game-changing benefits of AI-powered M&A platforms now with a significant acceleration of new capabilities coming to market in 2024.”

AI and embedded finance
Eduardo Martinez Garcia, CEO and co-founder of Toqio
Eduardo Martinez Garcia, CEO and co-founder of Toqio

2024 will be the year of embedded finance technology, says Eduardo Martinez Garcia, CEO and co-founder of embedded finance platform Toqio, with AI impacting this sector.

“Since embedded finance refers to the digital process of integrating financial services into non-financial products and services, and everything digital seems to move at breakneck speed, it will ramp up in 2024.

“Several emerging technologies, including AI and machine learning, will slowly make their way into the embedded finance space throughout 2024. We can expect to see increased adoption of these technologies by corporate embedded finance platforms and other fintech companies.

“Tentative steps have already been made, but the serious consequences of issues arising from implementing these sorts of technologies have made those integrating them trepidatious, to say the least. Both AI and ML are yet to be seen in corporate embedded finance.

“That’s mainly because integration, especially with regard to lending, will be all about data collection and how to analyse the information extracted. Those two technologies, when linked to data science, will therefore be key differentiators in the future.”

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