Fintech entrepreneur Dr Ozan Ozerk took the stage at the Qatar Web Summit 2024, held in Doha from 26 to 29 February. Dr Ozerk and his co-panellist Edward Achtner, Head of AI at HSBC, shared perspectives on how AI does and may change the way fintechs think and operate in the ‘Utilising AI in Fintech’ session. This year’s summit, a key event for business leaders worldwide, featured over 300 speakers and panellists across four days.
Ozan Ozerk is a renowned figure in fintech globally and the founder of numerous successful financial institutions, including banking-as-a-service provider Openpayd, European Merchant Bank (EMBank) and Turkey’s fast-growing e-money institution Ozan Electronic Money (Ozan Elektronik Para).
In response to a question on the areas of fintech where AI can be most helpful, Dr Ozerk indicated customer onboarding, transaction monitoring and handling compliance and risk tasks. Unless helped by service providers that utilise AI or similarly handle the service internally, fintechs can easily get bogged down with the overwhelming workload in these processes. This can make it hard or impossible to grow at scale, a typical stumbling block for fintechs. The use of AI not only speeds up the processes and makes them scalable but also reduces the risk of human and algorithmic errors.
Another topic for discussion was if and how AI could help us take better care of our money, more safely. Ozan Ozerk’s take on this matter was cautiously optimistic. He pointed out that AI should and would successfully help direct us to the right financial products and better trading decisions, reducing the burden of individually processing a load of information along the way.
Yet in parallel, he was wary about how inclusive the process would be. Will the unbanked and underbanked masses be able to enjoy the benefits of AI in finance in a similar fashion? Financial institutions are expected to have top-notch cybersecurity and apply KYC/AML procedures effectively. They are regulated to do so. However, using AI in these processes could further undermine the inclusivity of their services if the AI component wasn’t handed properly.
Dr Ozerk said, “I am worried about the flip side of the coin. I’m worried that for the sake of risk management, AI will be used to exclude more people. The amount of data we can capture on a business or an individual, it’s a threshold that’s becoming too high. People who have a good CV or good data points will get even better services, and people who have, for some reason, weak data points will get worse services or none at all. I do understand there’s a threat from criminal organisations or people who want to abuse a service by making AI an accomplice as they try to commit a crime. But I’m also concerned about a growing chasm of access: Basically, people may get excluded just because a robot told you they should not be banking with you.”
Talking about how to best benefit from AI, Dr Ozan Ozerk pointed out that in terms of institutions and their technology, all the links in the chain must be connected to deliver AI’s full benefits to customers: “For example, international payments are a landscape where various parties depend on each other. If you’re moving money or assets across institutions or businesses, you have a lot of pieces that need to come together in the right way. With the increased use of AI, companies that do not utilise AI will become bottlenecks. Let’s say I work with Bank XYZ, a client of theirs. They have AI, and I have AI, great. But suppose their corresponding bank or my client on the other end doesn’t use AI. In that case, we might end up with money or a transaction stuck with Bank XYZ or at my payment institution because the non-AI institution is not ready to process the funds or the data with the same diligence the two of us can.
The next topic in the panel was the expected changes in the workforce and talent pool that the extended use of AI would impose on fintechs. Dr Ozan Ozerk embraced the upcoming changes from a historical perspective and was confident that society would adapt successfully. He said, “Well, much manual work today will be replaced by technology, and AI will be a big player in that space. Obviously, those employees doing the manual work will no longer have a future in that space. But somebody needs to take care of AI and technology as well. So, I think there will be new professions and positions within each company and society in general tasked to govern and utilise AI. So, I’m not that worried. If you look at how the internet and phone networks have replaced many things, it’s clear we will adapt to AI as well. In many countries, the population and workforce are declining. So, maybe utilising AI is especially beneficial for companies in those countries to maintain their competitive advantage and grow.”
In addressing how they applied and administered AI within their organisation, Ozan Ozerk replied: “So, the way we see it, AI is in its earliest phase. The regulation isn’t precise. The technology isn’t proven in many aspects. And jumping into it, pioneering is a huge question mark when running financial services because you cannot just break things and move on. So, what we do is we try to see the practices in non-regulated industries, how they are using AI, and assess if we can adapt them.
The panel’s final question was on what the panellists were most curious about happening 5 years from now. Dr Ozerk expressed his excitement about the potential of AI and technology to level the competitive field between big, long-established financial institutions and younger ones in the eyes of retail clients. He said, “Five years into the future, I wonder how retail clients will choose who they work with. Who has the best engines, best robots, best algorithms? The older and the younger institutions will face off in a much more challenging way than today.”
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