Using Artificial Intelligence in Credit Card Fintech

Prior to the emergence of credit cards, banks had to offer money to their borrowers in the form of either cash or check. This proved to be inconvenient for the major players in the lending sphere. Customers had to pay merchants in cash, which created difficulties in terms of cash maintenance. Banks (including central banks) faced struggles in tracking this hard cash. As a result, they began to provide checks, though these caused their own issues such as verification, risk of bounce, and security problems. In the 1960s, private companies (such as Visa and Mastercard) teamed up with banks to bring credit cards to the public. Banks appreciated the opportunity to expand their loan and credit services, while cardholders found it easy to access funds for shopping at merchants who accepted the cards. Furthermore, the digital footprints created through the use of credit cards could be tracked and monitored by central banks. The credit card is based on a number of different technologies, such as Magstripe, EMV, Tokenisation, and HSMs (which are hardware-based). Softwares developed using languages, frameworks, databases, cloud and infrastructure technologies are implemented to power card processing systems, core banking solutions, and payment switches. We have progressed significantly from the creation of credit cards and providing a smooth card payment experience, yet there are still certain issues requiring attention. I think Artificial Intelligence could be of help when it comes to tackling some of these obstacles. Let's get analyzing the difficulties experienced by each party involved. Managing stakeholders and addressing the associated challenges is an important part of any project. It is necessary to effectively assess and engage with all parties involved in order to ensure success. Effectively managing stakeholders and dealing with the hurdles that they present is a critical component of any project. It is important to accurately evaluate and collaborate with all individuals involved so that the objectives set out can be accomplished. A value proposition is a statement which outlines what sets an organization, product or service apart from others, essentially conveying why customers should select one offering over another. A value proposition is a statement which outlines why a customer should choose an organization, product or service over another one. It presents what makes the particular offering unique and different from that of competitors. must be taken into account before any important decision is made. Before making a significant decision, the potential risks must be taken into consideration. The road to using AI is far from straightforward. Its models are prone to hallucinations, which may result in incorrect credit assessments, erroneous recommendations and fraudulent transactions. AI models trained on biased data can't be applied to numerous real life situations. Algorithms used for AI are quite complex, making it a "black box", and this means that in order for AI models to be adopted, the algorithms must be simplified and presented in a way that is easy to comprehend for relevant stakeholders. The article discusses the implications of unemployment in the USA during the pandemic. This article looks at the effects of joblessness in the United States as a result of the COVID-19 crisis. It explores the impact on individuals and the economy as a whole. This blog can be used as a starting point to analyze the effects of AI on the credit cards industry. Further investigation is required to identify a particular stakeholder, explore potential applications and possible remedies. In my next blog, I will explain how artificial intelligence can affect the Prepaid cards market from a non-specialist point of view. Thank you for taking the time to read!

Source: https://medium.com/@kaustubh.varade/ai-in-fintech-credit-cards-19ef01b39f69?source=rss------fintech-5