Empowering the Unbanked: A Revolution in Financial Inclusion through Artificial Intelligence

Abstract

Financial institutions have been ambivalent with their approach towards adopting artificial intelligence (AI), following its rise in the 2010s. However, there are various areas where artificial intelligence could be applied in the finance industry which can reduce the problems faced by the unbanked and underbanked population. Furthermore, this paper specifically focuses on the application of Artificial Intelligence towards achieving financial inclusion for the unbanked and underbanked population. There are various challenges such as no credit history, lack of access to credit, lack of access to financial services and lack of personalized financial services. The paper seeks to address the problem and propose the solution for the same with the help of Artificial intelligence. First, the many components of the technology—including its background, operation, traits, SWOT analysis, and broad applications—are discussed. Secondly, the various efforts and initiatives by the different financial institutions and tech companies. Further, an overall overview on the Finance Industry is analyzed, wherein the structure and drawbacks of the existing system is elaborated. In the last section, an artificial intelligence-based solution has been proposed to solve the problems of the unbanked and underbanked population. Therefore, a strategic solution to an evident problem has been conveyed through this research and it poses a practical significance.