What Has Been the Growth Trajectory of the Generative Artificial Intelligence (AI) In Banking Market?
The generative artificial intelligence (ai) in banking market has seen considerable growth due to a variety of factors.
• The market size of generative artificial intelligence (AI) in the banking sector has seen a remarkable surge in recent times. The market, which currently stands at $1.16 billion in 2024, is projected to grow to reach $1.44 billion in 2025, with a compound annual growth rate (CAGR) of 24.1%.
Aspects like increased data access, the adoption of cloud computing, demand for personalized customer services, regulatory compliance pressures, and the emergence of disruptive fintech have catalyzed the growth witnessed during the historical period.
What Can Be Expected from the Generative Artificial Intelligence (AI) In Banking Market in the Coming Years?
The generative artificial intelligence (ai) in banking market is expected to maintain its strong growth trajectory in upcoming years.
• The banking sector's usage of generative artificial intelligence (AI) is predicted to witness skyrocketing growth in the coming years, reaching a market size of $3.39 billion by 2029. This tremendous growth, exhibiting a compound annual growth rate (CAGR) of 23.9%, is a result of factors such as the automation of banking protocol, increased demand for fraud detection mechanisms, a surge in digital banking, heightened requirements for operational efficiency, and an emphasis on improved customer experiences. Key trends projected for the forecast period include the use of AI-enabled chatbots, AI-supported risk management strategies, personalized financial services, AI-driven investment tools and incorporating AI into mobile banking applications.
What Are The Primary Growth Drivers In The Generative Artificial Intelligence (AI) In Banking Market?
With the increasing need for fraud detection and prevention strategies, the expansion of the generative artificial intelligence (AI) in banking sector is anticipated to surge. Fraud detection and prevention involves the application of techniques and technologies designed to discover, avert, and manage fraudulent operations. The mounting demand for these services stems from the escalating sophistication of fraudulent schemes and the expansion of financial transaction volumes. Generative AI fortifies the banking sector against fraud, helping detect anomalies by sifting through extensive data patterns to single out irregular transactions, interrupting fraudulent deeds in real time. For example, the Australian Bureau of Statistics, a government organization in Australia, revealed that roughly 8.7% of individuals (1.8 million) fell victim to card fraud in 2022–23, an increase from the 8.1% rate documented in 2021–22. Thus, the burgeoning need for fraud detection and prevention is fueling the growth of the generative artificial intelligence (AI) in banking sector.
How Is the Generative Artificial Intelligence (AI) In Banking Market segmented?
The generative artificial intelligence (AI) in banking market covered in this report is segmented –
1) By Technology: Natural Language Processing, Deep Learning, Reinforcement Learning, Generative Adversarial Networks, Computer Vision, Predictive Analytics
2) By Deployment Model: Cloud Deployment, On-Premises Deployment, Hybrid Deployment
3) By End-User: Retail Banking Customers, Small And Medium Enterprises, Investment Professionals, Compliance And Risk Management Teams, Operations And Process Optimization, Executives And Decision Makers
Subsegments:
1) By Natural Language Processing (NLP): Chatbots And Virtual Assistants, Sentiment Analysis For Financial Markets, Document And Contract Analysis, Speech Recognition For Customer Service
2) By Deep Learning: Fraud Detection And Prevention, Credit Scoring And Risk Assessment, Predictive Analytics For Investment, Customer Behavior Analysis
3) By Reinforcement Learning: Algorithmic Trading, Portfolio Management And Optimization, Dynamic Pricing Models, Personalized Financial Services
4) By Generative Adversarial Networks (GANs): Synthetic Data Generation For Training Models, Fraud Detection And Risk Management, Customer Data Augmentation For Personalization, Market Simulation And Analysis
5) By Computer Vision: Document Verification And Processing, ATM Surveillance And Security, Image-Based Fraud Detection, Visual Data Extraction For Financial Analysis
6) By Predictive Analytics: Risk Assessment And Management, Credit Scoring And Loan Default Prediction, Customer Churn Prediction, Market Trend Forecasting
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What New Trends Are Influencing the Generative Artificial Intelligence (AI) In Banking Market?
Leading entities in the generative artificial intelligence (AI) banking industry are creating ground-breaking solutions like responsible generative AI, aiming to ensure ethical, secure, and transparent financial mechanisms. They also aim to boost fraud detection and customer service quality. This classification of generative AI pertains to the production and utilization of generative AI arrangements that emphasize ethical measures, transparency, responsibility, and fairness. For instance, in May 2024, Temenos AG, a software establishment based in Switzerland, rolled out solutions of Responsible Generative AI for primary banking. This was viewed as a momentous stride towards AI integration in the finance services industry. These offerings are components of Temenos' AI-integrated banking structure, aimed at enhancing banks' data management. This results in higher profitability and productivity, in addition to ensuring safety and regulatory compliance. Users have the option to engage with the system via normal language inquiries, swiftly generating distinctive insights and reports. This minimizes the duration required by business partners to acquire important data, such as identifying the top profitable customer categories based on demographic characteristics.
Who Are the Key Players in the Generative Artificial Intelligence (AI) In Banking Market?
Major companies operating in the generative artificial intelligence (AI) in banking market are include:
•Google LLC
• Microsoft Corporation
• Amazon Web Services (AWS) Inc.
• Accenture plc
• International Business Machines Corporation (IBM)
• Oracle Corporation
• SAP SE
• Tata Consultancy Services (TCS) Ltd.
• Nvidia Corporation
• Salesforce Inc.
• Capgemini SE
• Cognizant Technology Solutions Corporation
• Infosys Limited
• Finastra Group Holdings Limited
• Pegasystems Inc.
• Temenos AG
• C3.ai Inc.
• Clari Inc
• DataRobot Inc.
• Aisera
• Kasisto Inc.
What Is The Most Dominant Region In The Generative Artificial Intelligence (AI) In Banking Market?
North America was the largest region in the generative artificial intelligence (AI) in banking market in 2024. The regions covered in the generative artificial intelligence (AI) in banking market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
