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Unlocking Financial Innovation: The Synergy of Open Banking and Artificial Intelligence in Banking System

In: Europe in the New World Economy: Opportunities and Challenges

Author

Listed:
  • Isabelle Oprea

    (Romanian Academy, School of Advanced Studies of the Romanian Academy, Doctoral School of Economic Sciences, National Institute for Economic Research “Costin C. Kirițescu”, Institute for World Economy)

Abstract

The synergy between Open Banking and Artificial Intelligence (AI) represents a key initiative in recent years that hit the banking industry at a global level. Open Banking, which is led by technological innovation and strict legal norms, started new times for data accessibility by allowing third parties to access and utilize the financial data of the clients of the banks. This information is accessed of course, with the consent of the bank’s customers. In the same time, AI technologies evolved and offer very useful tools for data analysis and automation. The base principles regarding data sharing of Open Banking, the client’s competencies and increased competition in the financial system created new ways of application of AI. This article explores the convergence between open banking and AI, investigating how this interaction is reshaping the financial services industry. Through a literature review, the study examines the current state of open banking and of Artificial Intelligence technologies, and how their merger is fostering innovation, upgrades customer experiences, and ensures greater financial inclusivity in banking system. The search reveals that the synergy of open banking and Artificial Intelligence imply substantial opportunities; it also presents challenges related to data privacy and security. It also provides practical implications for banks and Fintech companies targeting to navigate the evolving landscape of digital finance.

Suggested Citation

  • Isabelle Oprea, 2024. "Unlocking Financial Innovation: The Synergy of Open Banking and Artificial Intelligence in Banking System," Springer Proceedings in Business and Economics, in: Luminita Chivu & Valeriu Ioan-Franc & George Georgescu & Ignacio De Los Ríos Carmenado & Jean Vasile (ed.), Europe in the New World Economy: Opportunities and Challenges, chapter 0, pages 129-140, Springer.
    • Handle: RePEc:spr:prbchp:978-3-031-71329-3_7
    DOI: 10.1007/978-3-031-71329-3_7
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