Read on for 5 real-life examples of how AI is revolutionizing African businesses.
1. Credit Risk Assessment
According to Okwechime, AI can be used to assess credit risk, automate a significant part of the lending process, enable lenders to offer credit faster and even expand services to more customer segments without having to increase the workforce. He explained that leveraging data will build a credit decision engine that uses sophisticated statistical methods to generate risk ratings for customers based on various data attributes. “Such methods can approve loans without visiting a bank branch or other access points. At the same time, this is also able to manage risk to an acceptable level and provide appropriate credit limits tailored to the client’s circumstances,” he said
Over the years, as the digital channels for running businesses have increased significantly, AI has become an indispensable tool in preventing fraud and financial crime. Okwechime revealed that AI has the innate ability to analyze vast amounts of data and uncover fraud trends, which can then be used for real-time fraud detection. He explained that this is particularly useful for identifying fraudulent banking transactions and uncovering transactions that don’t fit with the normal behavior of certain customers. “These systems can also self-learn and recognize transactions that show similar trends to previously identified fraudulent activity,” Okwechime said. He added that AI also plays an important role in preventing identity fraud, as it enables digital channels to verify identity via face matching with government-issued IDs, biometrics, and even voice matching.
Okwechime noted that AI is bringing marketers new understanding and enduring commercial advantage, especially at a time when communicating with customers is easier, with multiple channels for dialogue and customer acquisition. He said: “AI uses customer data and profiles to learn how best to communicate with customers and then delivers them tailored messages at the right time without intervention from members of the marketing team to ensure maximum efficiency.” He added, that companies could also use AI to prioritize leads, which is especially relevant when companies have hundreds of leads a day but limited resources. “Using data like drop-off information gathered during customer onboarding, AI can prioritize leads most likely to convert, ensuring efficient use of limited marketing resources while maximizing conversion rates.”
4. Chatbot (conversational agents or dialogue systems)
A new wave of change in the way consumers interact with services is emerging, driven by the growing demand for quick responses from customers. According to Okwechime, AI-powered chatbots use natural language processing to understand conversations and their context at a sufficiently advanced level to generate appropriate responses. He explained that recent advances have gone beyond text-based chats, with companies like Apple (Siri), Google and Amazon (Alexa) introducing voice-enabled virtual assistants capable of competently answering an infinite number of questions in natural language dialogue . “In a market like Africa, where literacy rates lag far behind the world average, voice-enabled products and services will revolutionize the way a consumer interacts with technology platforms, lowering barriers to entry and improving technology adoption,” he said.
Finally, Okwechime explained that AI for operations combines sophisticated methods from deep learning, data stream processing and domain knowledge to analyze data collected from operational pipelines to increase efficiency, reduce costs and maintain optimal delivery and quality of services . Depending on the type of business, this includes multiple industries including but not limited to:
- Using historical data to estimate prices when purchasing goods or services.
- Using macroeconomic factors to forecast value and any upcoming appreciation or depreciation.
- Forecast periods or locations of high demand ahead of time to prepare accordingly and maximize yields.
- Liquidity management, predicting future events of liquidity problems based on predicted or projected growth.
About Dumebi Okwechime – Founder Izifin