Abstract
The emergence of Industry 4.0 has transformed the financial landscape by integrating unconventional technologies and artificial intelligence (AI) into consumer interactions. This chapter explores the evolving paradigm of human-centric AI-thinking in the context of emerging customer interactions in making financial decisions. The review analyses the opportunities and the challenges that arise from the integration of AI tools and human-centric approaches in addressing the diverse needs and behaviours of consumers within emerging financial markets. More specifically, the review critically examines the utilization of AI-driven technologies, such as predictive analytics, natural language processing (NLP), and machine learning algorithms, in customising the financial services to cater the emerging-market consumers. Moreover, the current study explicates how AI enables personalized customer interactions, risk assessments, and ethical decision making and financial inclusion strategies while considering the socioeconomic and cultural landscapes. The study has focussed on addressing the concerns related to data privacy, risk assessment, and transparency towards AI-powered financial solutions with ethical standards. Through an exhaustive analysis of current trends, and empirical evidence from the existing literature, this review highlights the inevitability of human-centric AI-thinking approach towards financial services decision making. It emphasizes the importance of congruent AI-driven financial solutions in the context of banking where the determinants such as empathy, financial literacy, ethical considerations, and human values plays a significant role in finding the financial services in emerging markets. This research explores the challenges and prospects and has made commendations to all the major stakeholders such as industry stakeholders, policymakers, practitioners, customers, and service providers to create a dynamic financial landscape of Industry 4.0 in AI technologies that embrace a human-centric ethos to meet the evolving needs of consumers within emerging financial ecosystems.
TopIntroduction
The emergence of artificial Intelligence (AI) in the financial landscape has brought significant improvements in the financial sector, predominantly in the interactions between consumers and AI-driven technologies. This review of the literature aims to provide an overview of the existing literature by identifying the knowledge gaps for future research towards the human-centric AI-thinking in banking and financial services. The phenomenon of AI applications has garnered greater interest towards digital financial accessibility for individuals in many developed and developing nations. Banking innovation started from the transition of a traditional banking system 1.0 to a self-service banking 2.0 through automated teller machines and the internet services. This banking 2.0 model was surpassed by the mobile banking 3.0 by the digital fintech systems for a convenient, manageable, and accessible banking services. Furthermore, AI has driven the banking into the next era of tech embedded, platform-based banking 4.0. This directs the attention towards customer centricity which helps on realizing and tailoring to the needs and preferences of the customer. This transition from existing mixed financing models across the world has obstacles while offering secured transactions, speed, transparency, and trust in the system. Financial inclusion is becoming an important aspect for the developing countries with a motive to improve the financial literacy and more informed decisions towards their investment decisions and credit availing decisions. These decisions encompass a range of services pertaining to the effective management of monetary resources, access to insurance coverage, facilitation of investments, and provision of loans with the aim of extending these services to all individuals (Chibba, 2009). The integration of AI in the digital financing services has brought a unprecedent change in the realm of banking services, presenting supreme levels of accessibility and convenience. Furthermore, these AI based services have also provided a promising potential for the developing countries in mitigating the pervasive issue of poverty. These AI based platforms now offer a wide range of financial services such as transmitting and receiving funds, accumulating financial resources tec., catering to the various demographic profile customers with diverse needs. Sethi and Acharya (2018), has stressed that as coin have both the sides it is imperative that the utilisation of this technology also presents potential susceptibilities such as security and privacy aspects. In light of these vulnerabilities, many Fintech companies are embracing latest technological algorithms with the aim of achieving operational efficiency and competitive advantage. With more than half of its people being deemed financially excluded or neglected, India has the second-biggest unbanked population in the entire globe (Yasir et al., 2022). Indian culture discourages taking risks; hence banks serve as essential financial institutions that guard the people from cash-related risks. With the aid of mobile banking technologies, banks were able to replace physical currency with flexible, economical, and less risky payment mechanisms (Pal & Herath, 2020; Chowdhury & Chowdhury, 2023). While AI can automate many tasks, human-centric AI thinking acknowledges the importance of human expertise in financial services. It promotes a collaborative approach where AI augments human capabilities rather than replacing them entirely Adel, 2022). Human-centric artificial intelligence (AI) when it comes to financial services and management, human-centric artificial intelligence (AI) refers to the application of AI technologies and systems that give human needs and experiences the top priority (Mhlanga, 2022). The approach strives to increase the efficacy, efficiency, and user-friendliness of financial operations while taking ethical issues, openness, and regulatory compliance into account. In the context of financial services, “human-centric artificial intelligence” (AI) refers to the use of AI technologies and systems with the main goal of improving customer experience and financial service delivery (Umamaheswari & Valarmathi, 2023).