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In the past few years, Artificial Intelligence (AI) has been a game changer in the financial advisory sector through the way it functions and delivers services. With the ability to process large amounts of data, analyse complex patterns and make data-driven decisions, AI has eased traditional financial processes by improving advisory services and their overall efficiency.

One of the most important impacts that AI has in the financial advisory sector is the ability to facilitate and analyse large volumes of data quickly and accurately, says Thys van Zyl, head of product development at Everest Wealth.

AI can analyse information in various forms, including market trends, news articles, financial statements and even social media. This data analysis helps financial institutions to make more informed investment decisions, analyse and identify patterns and abnormal market trends. Using AI-powered analytics, financial advisors can offer personalized investment strategies based on individual risk profiles, financial goals and market conditions.

According to Van Zyl, AI-powered automation has also revolutionized and simplified the daily tasks in the financial advisory sector. Robotic process automation (RPO) has enabled institutions to automate repetitive and time-consuming processes, such as data entry, reconciliation and compliance checks. This reduces human error, improves operational efficiency and frees up valuable time for finance professionals to focus on higher value tasks. Furthermore, AI-powered virtual assistants provide instant customer service, answer queries and guide customers through basic transactions, thereby improving customer service and reducing response time.

AI’s advanced algorithms have also significantly improved risk management in the financial sector. Machine learning models can analyse historical data, identify patterns and predict potential risks. This enables financial institutions to accurately assess creditworthiness, detect fraudulent activity and prevent potential financial crimes. By monitoring ongoing transactions and user behaviour, AI systems can send alerts for suspicious activity, reducing risks associated with money laundering, identity theft and other fraudulent activities. Such risk management capabilities provide increased security and confidence for both financial institutions and their clients.

The financial industry operates under strict regulatory frameworks and according to Van Zyl, AI plays a decisive role in ensuring compliance by automating compliance checks, monitoring regulatory changes and identifying possible violations. AI-powered systems can quickly scan large volumes of data and highlight inconsistencies, helping institutions maintain transparency and comply with regulations as well as strengthen overall management practices.

“AI’s influence on the financial advisory sector cannot be overemphasized. With its data analytics capabilities, automation, risk management and compliance functions, AI is transforming the industry by improving decision-making, efficiency and customer service. Financial institutions and advisors that embrace AI technology are well positioned to adapt to the rapidly changing market dynamics and deliver better services in an increasingly data-driven and digital landscape.”