Fintech and AI set to disrupt banking industry
Fintech will disrupt the payment and the money transfer businesses of UAE banks and lead some lenders to rethink their branch network and staffing strategies by focusing on enhancing efficiency, says Mohamed Damak, senior director and global head of Islamic finance at S&P.
“Fintechs are offering more efficient and rapid solutions for money transfer and banks will have to adapt to that. On the lending side, we don’t think that fintech will disrupt UAE banks in the next two years because lending is still concentrated on large single names and involve a significant human added value from the relationship manager up to the board deciding on these loans,” he said.
M.R. Raghu, managing director of Marmore Mena Intelligence, says artificial intelligence (AI) can transform both front- and back-office operations; software robots deployed across business process functions can result in quicker turnaround.
AI can provide seamless differentiated customer experience on digital channels, and security measures with its integration within the banking infrastructure. While the application of blockchain technology already has some real-world applications for the short to medium term, he said.
The broader areas for applying blockchain in retail banking are identity management, contract management and payment transactions.
Stuart Scoular, partner with PricewaterhouseCoopers in the Middle East, says a lot of emerging technologies are going to impact banking.
This will be through the adoption of technologies by the banks or by fintech or organisations that may develop these technologies to compete against banks.
In some cases, the technologies are here now: they are already being adopted aggressively by many organisations here in the UAE.
A good example is robotics, where UAE banks are already applying the use of this technology.
Other technologies are expected to emerge rather quickly, once the case around their development becomes more robust. An example of that would be the evolution or expansion of blockchain, as well as further development around AI.