The global AI in fintech market revenue stood at $7,702.7 million in 2020, and it is predicted to surge to $46,881.9 million by 2030. According to the estimates of the market research company, P&S Intelligence, the market will demonstrate a CAGR of 19.8% from 2020 to 2030 (forecast period). The market is being driven by the growing focus of businesses on efficiency improvement and cost-cutting, rising adoption of artificial intelligence (AI), machine learning (ML), and internet of things (IoT) in financial institutions, surging adoption of the 5G technology, soaring use of fintech, and burgeoning requirement for cloud services across the world.

AI-based solutions are assisting businesses in reducing costs, automating processes, and mitigating the chances of errors. For example, many companies are using AI chatbots as customer assistants for various tasks, such as customer care executive (over the phone), online chat executive, and sales. By answering various frequently asked questions about a product or a service or a company, these chatbots improve customer experience by helping users get answers to their questions immediately. Moreover, these chatbots assist the company in saving money and time.

Furthermore, AI enables process automation, which plays a critical role in task execution within financial companies. The main aim of automation in the banking industry is to help in processing repetitive banking operations. Some of the major benefits of automation are time savings (frees up time for employees so that they can focus on more complex tasks), cost savings, mitigating the chances of human errors, and scalability. Depending on component, the AI in fintech market is divided into services and solutions.

Of these, the solutions category contributed higher revenue to the market in the past, and it is predicted to exhibit rapid expansion in the coming years as well. By enabling less manual work and rapid data processing, AI solutions assist financial institutions in creating a better and more engaging financial environment with enhanced customer experience. When application is taken into consideration, the market is classified into fraud detection, credit scoring, chatbots, and quantitative and asset management. Amongst these, the quantitative and asset management category is predicted to demonstrate the fastest growth in the coming years.

This is credited to the fact that AI is rapidly transforming the asset management sector by assisting fundamental analysts in conducting researches and extracting more information and helping them discover accurate investing ideas. Geographically, North America held the largest share in the AI in fintech market in the past, primarily because of the existence of a well-developed information technology (IT) infrastructure, large-scale adoption of the 5G technology, and rapid fintech adoption rate in the region.

Additionally, the U.S. government recently launched the American AI initiative under Executive Order 13859 in February 2019 in order to recognize the strategic relevance of AI for the future security and economy of the U.S. This project basically targeted five critical lines of effort, namely, unleashing federal AI data and computer capabilities, augmenting AI research expenditure, developing AI technical standards, and building AI workforce with international allies in the country.

Thus, the market will grow substantially in the coming years, primarily because of the rising focus of financial companies on providing an improved customer experience and enhancing their operational efficiency.