CEOs call for smarter use of AI and data analytics in financial sector

Industry leaders meeting in Nairobi say the challenge now is moving beyond collecting data to turning it into actionable insights.

More than 180 executives from banks, SACCOs, microfinance institutions and fintechs are discussing the growing role of artificial intelligence in financial services.

The discussions are focusing on how alternative data and advanced analytics can help institutions make faster and more informed decisions.

Jubilee Holdings Group CEO Dr Julius Kipng'etich said the ability to process data and turn it into useful insights will increasingly determine competitiveness in the financial sector.

“Because people receive the same data, how you process that data and make decisions about it is where your competitiveness will come. What are customers looking for today? They are looking for products which are tailored for them,” Kipng'etich stated.

As financial institutions expand their digital services, industry players say the ability to interpret large volumes of data will increasingly determine how effectively businesses identify risks and respond to changing customer needs.

Metropol Credit Reference Bureau CEO Gideon Kipyakwai said digital lenders are already using artificial intelligence and data scoring to assess customers and determine their ability to repay loans.

“What is the secret that the digital lending ecosystem has? It is the use of scoring that looks at all the data points in a very fast and efficient way. These are platforms that leverage AI to analyse a customer, give them the right loan limit and determine whether they actually have the capacity to repay,” Kipyakwai stated.

But greater reliance on artificial intelligence also raises questions around responsible data use, strong governance and systems that ensure automated decisions remain accurate and accountable.

Spin Mobile CEO Dr Victor Kiplagat said institutions must also guard against biases and inaccurate decisions resulting from insufficient data.

“When you talk about the risks, they would be biases that would probably come out of that, or aspects of insufficient data to be able to make proper decisions. AI is based on data, so you need a lot of data to be able to draw patterns that then develop into insights and the decisions that people will make,” Kiplagat stated.

AI may be changing the financial sector, but the real test will be how effectively institutions turn data into better decisions for businesses and their customers.