When fintech companies hear "AI," one of the first things that might come to mind is chatbots. These tools have been a convenient way to streamline customer interactions. However, limiting artificial intelligence to basic functions like answering FAQs can restrict its potential. As fintech ventures aim to differentiate themselves, AI should play the role of a builder, helping develop, refine, and improve services from the ground up.
Let’s break it down.
Using AI Beyond Surface-Level Applications
AI-driven chat capabilities are undoubtedly useful for handling repetitive tasks, but there’s more under the hood. The true strength of AI lies in its ability to analyze data, improve workflows, and iterate based on real-world evidence. For fintech companies, this means leveraging AI to not only interact with users but also shape their entire product development strategy.
A Missed Opportunity: Sticking to Chatbots
While chatbots support basic functions, such as responding to user queries, they don't alter how products and business processes are built. The fintech industry, with its reliance on precision, compliance, and customer centricity, requires tools that can provide deeper insights and support across operations.
According to research by the Cambridge Centre for Alternative Finance, 80% of fintech companies already incorporate AI. However, many focus on customer-facing solutions and overlook how AI could transform internal processes. In a sector with tight regulations and high stakes, relying on outdated tools or practices means lost opportunities.
Creating Value Through AI as a Builder: Main Use Cases
Here’s how fintech companies can rethink their relationship with AI:
1. Streamlined Product Development
AI can develop prototypes, refine financial applications, and even generate mockups for testing purposes. Instead of waiting for engineers to code and design, AI allows fintech teams to experiment with solutions faster. AI-assisted tools also help companies slot in customer feedback earlier in the development cycle, saving time and resources.
For example, companies like Stripe use machine learning to refine payment APIs before they launch. By doing this, fintechs can avoid expensive iterations later.
2. Decision-Making with Predictive Analytics
Fintech businesses rely heavily on making accurate predictions about risk, customer behavior, and market trends. Incorporating predictive algorithms into decision-making processes yields faster, evidence-driven outcomes. Lending startup Upstart is a case in point, it uses AI to assess borrower risk more holistically, bypassing traditional credit scoring models.
3. Operational Workflow Optimization
Beyond customer interactions, AI excels at automating intricate workflows. From compliance checks to fraud detection, these tools can process data at speeds beyond human capability while maintaining accuracy. Consider how AI models help PayPal flag fraudulent transactions in real-time. The result? Faster resolutions and fewer losses.
How To Start Treating AI as a Builder
Realigning your approach means shifting resources from cosmetic AI enhancements to structural ones. Follow these steps to maximize AI’s value across your organization:
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Identify Bottlenecks
Look for stages in your operations where delays or inefficiencies occur. This could include manual compliance reviews or a labor-intensive product development process. -
Experiment with Prototypes
Use AI-enabled tools to create experiments before committing to final builds. Many platforms now allow for rapid prototyping by connecting minimal backend systems to pre-trained AI models. -
Invest in Training Your Team
For AI to do meaningful work, cross-functional collaboration is important. Equip your team with the skills and knowledge to use AI tools effectively. -
Monitor and Iterate
AI doesn’t operate in a vacuum. Build a feedback loop to monitor its performance and adapt as challenges evolve. Collect data from your operations and customers to ensure it’s delivering practical results.
Mistakes to Avoid
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Over-Scaling Too Soon
Diving straight into enterprise-level integration without testing smaller-scale applications can backfire. It might lead to costly errors or systems that don’t meet user needs. -
Neglecting Collaboration Between Teams
Successful AI integration requires communication among departments. Teams that work in silos often struggle to fully unlock AI’s potential. -
Forgetting About Governance
With growing global focus on ethics in AI, fintechs must ensure transparency. Build processes to safeguard data, meet regulatory requirements, and manage risks effectively.
A Deeper Look: Why This Matters
The fintech sector is more competitive than ever. A 2024 study projects the AI in fintech market to grow from $15.4 billion to $60.3 billion by 2033, with an annual growth rate of 16.45%. Fintechs that stick to surface-level AI implementations will struggle to compete with those that recognize AI as a central innovation tool.
This isn’t just about cutting costs or improving margins, it’s about creating nimble, scalable solutions that respond to market demands in real-time.
Conclusion
When fintechs treat AI as a mere chatbot, they risk missing out on its transformative potential. AI has the power to drive deeper changes, speeding up development, supporting smarter decision-making, and improving workflows across organizations. It’s time to envision AI as a hands-on builder, ready to roll up its sleeves and shape the future of financial services.
Take action today. Start exploring tools that allow AI to become part of your product and operational DNA. Make the leap from simple automation to strategic empowerment, and set yourself apart in a rapidly evolving market. AI isn’t waiting, are you?
FAQ
1. Why should fintechs use AI beyond customer-facing chatbots?
AI offers capabilities that transcend basic customer interactions, such as streamlining product development, enhancing predictive analytics, and optimizing workflows. By embedding AI into their operations, fintechs can save time, improve compliance, and boost customer satisfaction. Read more about AI's transformative role.
2. What is one example of AI in fintech product development?
AI-driven tools allow fintech companies to rapidly develop and refine product prototypes, enabling quicker iterations and early feedback collection. For instance, Stripe uses AI to refine its payment APIs before launch. Learn how Stripe uses AI.
3. How can AI improve decision-making in fintech?
AI-powered predictive analytics help fintech firms make accurate market predictions and assess risks. For example, Upstart uses AI to evaluate borrower risk beyond traditional credit scoring. Discover Upstart’s AI model.
4. How does AI optimize operational workflows?
AI automates tasks like compliance checks and fraud detection, processing data faster and more accurately than humans. PayPal, for example, uses AI to flag fraudulent transactions in real-time. Explore PayPal fraud detection.
5. What is the first step for fintechs to treat AI as a builder?
Begin by identifying inefficiencies or bottlenecks in your current operations, such as labor-intensive product development processes, and explore AI-driven solutions to address them.
6. What are some mistakes fintechs should avoid with AI integration?
Key errors include over-scaling AI implementations prematurely, failing to promote interdepartmental collaboration, and neglecting ethical responsibilities like data governance. Avoid common AI pitfalls.
7. How can AI help with compliance in a tightly regulated industry?
AI enables fintechs to process regulatory data efficiently, reducing the risk of compliance failures. For smaller firms or regional banks, partnerships with fintech AI providers can ensure better data hygiene. Read about AI and regulatory compliance.
8. What role does generative AI play in fintech?
Generative AI can create synthetic data for training systems, model financial risks, and even enhance fraud detection capabilities. It’s a game changer for enabling smarter financial services. Discover generative AI applications.
9. Is there a financial incentive to treat AI as a builder?
Yes, using AI strategically across operations can significantly cut costs while enhancing customer experiences. Deloitte projects $31 billion in savings for traditional institutions through AI by 2030. Learn how AI generates savings.
10. Why is AI crucial for fintechs to stay competitive?
The AI in fintech market is projected to grow from $15.4 billion in 2024 to $60.3 billion by 2033. Firms that go beyond surface-level implementations to use AI comprehensively will gain a major competitive edge. Explore AI market growth.
About the Author
Violetta Bonenkamp, also known as MeanCEO, is an experienced startup founder with an impressive educational background including an MBA and four other higher education degrees. She has over 20 years of work experience across multiple countries, including 5 years as a solopreneur and serial entrepreneur. Throughout her startup experience she has applied for multiple startup grants at the EU level, in the Netherlands and Malta, and her startups received quite a few of those. She’s been living, studying and working in many countries around the globe and her extensive multicultural experience has influenced her immensely.
Violetta Bonenkamp's expertise in CAD sector, IP protection and blockchain
Violetta Bonenkamp is recognized as a multidisciplinary expert with significant achievements in the CAD sector, intellectual property (IP) protection, and blockchain technology.
CAD Sector:
- Violetta is the CEO and co-founder of CADChain, a deep tech startup focused on developing IP management software specifically for CAD (Computer-Aided Design) data. CADChain addresses the lack of industry standards for CAD data protection and sharing, using innovative technology to secure and manage design data.
- She has led the company since its inception in 2018, overseeing R&D, PR, and business development, and driving the creation of products for platforms such as Autodesk Inventor, Blender, and SolidWorks.
- Her leadership has been instrumental in scaling CADChain from a small team to a significant player in the deeptech space, with a diverse, international team.
IP Protection:
- Violetta has built deep expertise in intellectual property, combining academic training with practical startup experience. She has taken specialized courses in IP from institutions like WIPO and the EU IPO.
- She is known for sharing actionable strategies for startup IP protection, leveraging both legal and technological approaches, and has published guides and content on this topic for the entrepreneurial community.
- Her work at CADChain directly addresses the need for robust IP protection in the engineering and design industries, integrating cybersecurity and compliance measures to safeguard digital assets.
Blockchain:
- Violetta’s entry into the blockchain sector began with the founding of CADChain, which uses blockchain as a core technology for securing and managing CAD data.
- She holds several certifications in blockchain and has participated in major hackathons and policy forums, such as the OECD Global Blockchain Policy Forum.
- Her expertise extends to applying blockchain for IP management, ensuring data integrity, traceability, and secure sharing in the CAD industry.
Violetta is a true multiple specialist who has built expertise in Linguistics, Education, Business Management, Blockchain, Entrepreneurship, Intellectual Property, Game Design, AI, SEO, Digital Marketing, cyber security and zero code automations. Her extensive educational journey includes a Master of Arts in Linguistics and Education, an Advanced Master in Linguistics from Belgium (2006-2007), an MBA from Blekinge Institute of Technology in Sweden (2006-2008), and an Erasmus Mundus joint program European Master of Higher Education from universities in Norway, Finland, and Portugal (2009).
She is the founder of Fe/male Switch, a startup game that encourages women to enter STEM fields, and also leads CADChain, and multiple other projects like the Directory of 1,000 Startup Cities with a proprietary MeanCEO Index that ranks cities for female entrepreneurs. Violetta created the "gamepreneurship" methodology, which forms the scientific basis of her startup game. She also builds a lot of SEO tools for startups. Her achievements include being named one of the top 100 women in Europe by EU Startups in 2022 and being nominated for Impact Person of the year at the Dutch Blockchain Week. She is an author with Sifted and a speaker at different Universities. Recently she published a book on Startup Idea Validation the right way: from zero to first customers and beyond, launched a Directory of 1,500+ websites for startups to list themselves in order to gain traction and build backlinks and is building MELA AI to help local restaurants in Malta get more visibility online.
For the past several years Violetta has been living between the Netherlands and Malta, while also regularly traveling to different destinations around the globe, usually due to her entrepreneurial activities. This has led her to start writing about different locations and amenities from the POV of an entrepreneur. Here’s her recent article about the best hotels in Italy to work from.
About the Publication
Fe/male Switch is an innovative startup platform designed to empower women entrepreneurs through an immersive, game-like experience. Founded in 2020 during the pandemic "without any funding and without any code," this non-profit initiative has evolved into a comprehensive educational tool for aspiring female entrepreneurs.The platform was co-founded by Violetta Shishkina-Bonenkamp, who serves as CEO and one of the lead authors of the Startup News branch.
Mission and Purpose
Fe/male Switch Foundation was created to address the gender gap in the tech and entrepreneurship space. The platform aims to skill-up future female tech leaders and empower them to create resilient and innovative tech startups through what they call "gamepreneurship". By putting players in a virtual startup village where they must survive and thrive, the startup game allows women to test their entrepreneurial abilities without financial risk.
Key Features
The platform offers a unique blend of news, resources,learning, networking, and practical application within a supportive, female-focused environment:
- Skill Lab: Micro-modules covering essential startup skills
- Virtual Startup Building: Create or join startups and tackle real-world challenges
- AI Co-founder (PlayPal): Guides users through the startup process
- SANDBOX: A testing environment for idea validation before launch
- Wellness Integration: Virtual activities to balance work and self-care
- Marketplace: Buy or sell expert sessions and tutorials
Impact and Growth
Since its inception, Fe/male Switch has shown impressive growth:
- 5,000+ female entrepreneurs in the community
- 100+ startup tools built
- 5,000+ pieces of articles and news written
- 1,000 unique business ideas for women created
Partnerships
Fe/male Switch has formed strategic partnerships to enhance its offerings. In January 2022, it teamed up with global website builder Tilda to provide free access to website building tools and mentorship services for Fe/male Switch participants.
Recognition
Fe/male Switch has received media attention for its innovative approach to closing the gender gap in tech entrepreneurship. The platform has been featured in various publications highlighting its unique "play to learn and earn" model.
