What are the latest figures on the generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market’s size and projected CAGR?
The generative artificial intelligence (AI) in banking, financial services, and insurance (bfsi) market size has grown exponentially in recent years. It will grow from $1.88 billion in 2024 to $2.37 billion in 2025 at a compound annual growth rate (CAGR) of 26.3%. The growth in the historic period can be attributed to increasing utilization of generative artificial intelligence (AI) in fraud detection, rise in personalized customer experiences, increasing focus on adoption of chatbots and virtual assistants in banks, regulatory compliance, and risk management, and operational efficiency and cost reduction.
The generative artificial intelligence (AI) in banking, financial services, and insurance (bfsi) market size is expected to see exponential growth in the next few years. It will grow to $6.01 billion in 2029 at a compound annual growth rate (CAGR) of 26.1%. The growth in the forecast period can be attributed to growing demand for enhanced customer service, generative models to provide personalized customer interactions, artificial intelligence (AI) being used to design personalized financial products, growing need for real-time fraud detection in the banking sector, and rising investments in artificial intelligence (AI). Major trends in the forecast period include advanced artificial intelligence techniques, developing new products, integrating machine learning, blockchain technologies, and predictive analysis.
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Which Market drivers have played a significant role in driving the generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market?
The rise in financial fraud is expected to propel the growth of generative artificial intelligence (AI) in banking, financial services, and insurance (BFSI) market going forward. Financial fraud refers to any intentional act of deception or misrepresentation to obtain money, assets, or other financial benefits illegally. The rise in financial fraud is due to increased digital transactions, sophisticated cybercrime techniques, the growing complexity of the financial system, and inadequate security measures. Artificial intelligence (AI) is crucial in enhancing financial fraud management within the banking, financial services, and insurance (BFSI) sector by providing advanced tools and techniques to detect, prevent, and mitigate fraudulent activities. For instance, in May 2023, according to UK Finance, a UK-based trade association for the banking sector, authorized fraud losses reached £485.2 million ($616 million), with 207,372 total cases in 2022, an increase of 6% compared to 2021. Therefore, the rise in financial fraud drives the growth of the generative artificial intelligence (AI) in the banking, financial services, and insurance (BFSI) market.
What are the key segments within the generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market?
The generative artificial intelligence (AI) in banking, financial services, and insurance (bfsi) market covered in this report is segmented –
1) By Deployment Mode: On-Premise; Cloud-Based
2) By Application: Fraud Detection; Risk Assessment; Customer Experience; Algorithmic Trading; Other Applications
3) By End-User: Banks; Insurance Companies; Financial Service Providers
Subsegments:
1) By On-Premise: Small And Medium Enterprises (SMEs); Large Enterprises
2) By Cloud-Based: Public Cloud; Private Cloud; Hybrid Cloud
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Which key players are shaping the generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market?
Major companies operating in the generative artificial intelligence (AI) in banking, financial services, and insurance (BFSI) market areAmazon Web Services Inc., Alphabet Inc., Microsoft Corporation, Accenture PLC, IBM Corporation, The Allstate Corporation, Salesforce Inc., NVIDIA Corporation, Intuit Inc., SAS Institute Inc., DeepMind Technologies Limited, DataRobot Inc., C3.ai Inc., AlphaSense Inc., Marqeta Inc., Upstart Holdings Inc., Hugging Face Inc., Kensho Technologies Inc., ZestFinance Inc., TrueLayer Limited, Numerai Inc.
Which transformative trends will shape the generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market landscape?
Major companies operating in the generative artificial intelligence (AI) in the banking, financial services, and insurance (BFSI) market are focused on developing technological advancements such as GenAI-powered virtual relationship managers (VRM) to improve customer experience and streamline banking operations. Generative AI-powered virtual relationship managers (VRMs) are advanced digital assistants that leverage generative AI technology to interact with customers and manage relationships that can handle tasks such as account management, financial advice, transaction support, and customer service, improving efficiency and customer experience. For instance, in July 2024, the Bank of Baroda (BoB), an India-based banking institution, launched the Generative AI-powered Virtual Relationship Managers (VRMs). This provides real-time information on BoB’s products and services while assisting customers with everyday banking needs such as account statements, checkbook requests, and debit card requests. The multilingual VRM is accessible through video, audio, and chat interfaces.
How do regional factors impact the generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market, and which region is the largest contributor?
North America was the largest region in the generative artificial intelligence (AI) in banking, financial services, and insurance (BFSI) market in 2024.Asia-Pacific is expected to be the fastest growing region in the market going forward. The regions covered in the generative artificial intelligence (AI) in banking, financial services, and insurance (BFSI) market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
What Does The Generative Artificial Intelligence (AI) In Banking, Financial Services, And Insurance (BFSI) Market Report 2025 Offer?
The generative artificial intelligence (ai) in banking, financial services, and insurance (bfsi) market research report from The Business Research Company offers global market size, growth rate, regional shares, competitor analysis, detailed segments, trends, and opportunities.
Generative artificial intelligence (AI) in banking, financial services, and insurance (BFSI) sector refers to the use of advanced AI models that can create new content, such as text, images, audio, or synthetic data, rather than just analyzing or recognizing patterns in existing data. This form of AI leverages techniques such as deep learning and natural language processing (NLP) to generate realistic and valuable outputs, which can enhance various functions within the BFSI industry.
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