How AI and machine learning are shaping the payments landscape

It goes without saying that Artificial Intelligence (AI) and Machine Learning are having a considerable influence on the world around us. From robotic process automation and speech recognition, to virtual agents and driverless cars. The extent of its impact is said to have moved us from a world that is mobile-first, to one that is AI first (according to Google’s CEO Sundar Pichai).

Ten to fifteen years ago, very few people were even familiar with the idea of Machine Learning or AI; today, however, the marketplace is a very different place. A recent global study from Pega found that 72 per cent of people now understand what AI is and that only 28 per cent are uncomfortable with the thought of it. It’s no surprise so many industries, companies – and those in the media – are so focused on it. Indeed, you only have to look at the prevalent discussions and outputs from the recent 2018 CES (Consumer Electronics Show) event to see this evolution.

Beyond the hype and heightened media attention around both AI and Machine Learning, and the numerous startups and internet giants racing to acquire them, there has been a significant increase in investment and adoption by enterprises. In fact, according to a Vanson Bourne study, ‘State of Artificial Intelligence for Enterprises’, 80 per cent of enterprises already have some form of AI in production today; 30 per cent are planning to expand their AI investments over the next 36 months; and, 62 per cent are expected to hire a Chief AI Officer in the future.

In the last decade alone, we have built powerful computers that can process more data and use more complex and sophisticated algorithms than ever before. In turn, the volume of data generated has increased exponentially, which can train those algorithms better. Such fast paced and innovative developments mean that there are huge opportunities.

Below are just some of the ways that this technology is taking the payments industry by storm.

Increased automation is leading to better insights

The impact of AI is felt strongly across the payments landscape, from changing the way people invest their money to automating the borrowing process; a huge development for those who’ve previously been overlooked as a result of cumbersome challenges and infrastructures.

A key benefit of AI is that it can help payments companies dramatically improve operational efficiency, examples include: reducing processing times and human error, as well as providing user insights and increased automation. In this sense, AI is helping businesses to reimagine and restructure operating models and processes. For example, it can support businesses in processing huge volumes of data to generate financial reports and satisfy regulatory and compliance requirements; processes that would typically involve large numbers of people performing repetitive data processing tasks.

In fact, AI’s transformative power is having such a monumental impact on the financial services industry that it has been predicted to replace up to 75 per cent of outsourced financial services jobs within 15 years (KPMG). This could have a huge implication on companies looking to reduce operational costs; enabling them to develop and nurture other areas of their business.

It goes without saying that it will also have an impact on workers themselves. With many debating whether AI leads to workforce augmentation or degradation. It can be argued that removing some of the more repetitive and laborious tasks gives employees the chance to either re-skill or up-skill and take on more strategic, and hopefully engaging, roles. In fact, Forbes research indicates that, by 2034, AI could boost labour productivity by up to 40 per cent.

With many companies having already invested in AI, thanks to advances in big data, open-source software, cloud computing, and faster processing speeds, it’s becoming increasingly mainstream.

Enabling more informed decisions

Both AI and Machine Learning are helping to support investing decisions which are data driven. Quantitative techniques and new methods for analysing big data have increasingly been adopted by key market players in recent years. And as the quantity and the access to data available continues to grow, it will continue to impact how investors look to leverage data analysis to make more informed decisions.

The lending industry has the potential to achieve massive operational and strategic efficiencies by implementing Machine Learning, with many key players expediting the lending process using Machine Learning and big data analytics. It’s already being used in all types of verticals from retail to healthcare, and across the financial services industry more broadly it can replace older statistical-modelling approaches with new and innovative techniques.

Broadly speaking, Machine Learning is having a huge impact on the industry as a reliable means of reducing spending and risk. Beyond this, consumer-centric tools are being used to automate the process of savings, providing a huge benefit to consumers, both in terms of the speed at which this can be processed and of course, the cost implications.

Success in action

An example of both AI and Machine Learning in action is the work one of our partners Kreditech is doing in the payments space. We partnered with a shared ambition and belief in the enormous potential of technology to unlock credit and financial services for underserved populations. Kreditech’s innovative technology uses Machine Learning and AI to improve financial freedom in the many high growth markets around the world that require better access to financial services, for example India and Brazil.

Specifically, Kreditech’s model uses data science and technology to enable companies to gain a better understanding about a customer’s credit rating. It uses Machine Learning and AI to process alternative data that subsequently enables them to develop scoring technology that takes advantage of this data to replace traditional credit models.

Services like those offered by Kreditech are important in economies where many merchants from mature markets are hesitant to lower their risk threshold based on traditional payment verification models. According to McKinsey, 2 billion people in developing nations don’t have access to financial services such as savings accounts and credit. That’s almost half of the developing world’s adult population. The opportunity is arguably huge.

AI and Machine Learning have enabled key players across the payments and fintech landscape to dramatically transform, both in terms of their back and front-end processes. From cutting costs, automating time-consuming operations and shortening the approval process, both AI and Machine Learning will continue to pave the way for the payments industry. The changes we’ve already seen are just the beginning and personally I’m excited to see what’s yet to come.

Jose Vélez is the Chief Executive Officer of PayU Latin America

Image Credit: Razum / Shutterstock

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‘Future Skills’ platform launched to upskill technology professionals in India

India’s Prime Minister, Mr Narendra Modi, announced thelaunch of the ‘Future Skills’ platform while addressing the World Congress onInformation Technology, jointly organised by NASSCOM, World InformationTechnology and Services Alliance (WITSA) and the State Government of Telnaganathrough a video link on February 19. The aim of the platform is to upskill InformationTechnology professionals in emerging technology areas.

NASSCOM, a not-for-profit industry association, is the apexbody for the 154 billion dollar IT BPM industry in India. NASSCOM has signed anagreement with the Ministry of Electronics and IT (MeitY) for strengtheningre-skilling initiatives and identified eight important technologies it will focuson to prepare people for jobs of the future: Artificial Intelligence, VirtualReality, Robotic Process Automation, Internet of Things, Big Data Analytics, 3DPrinting, Cloud Computing, Social and Mobile. It has also identified 55 jobroles that are expected to be in high demand globally.

According to a reportin Livemint, NASSCOM president R. Chandrashekhar said that the platform aimsto skill and up-skill about two million technology professionals and skillanother two million potential employees and students over the next few years.

Previously, in 2015, the Indian Government launched the NationalSkill Development Mission to ensure adequate availability of skilled workersand enable the country’s existing workforce to be able to re-skill and adapt tothe emergence of disruptive technologies.

PM Modi said, “I am sure, the “Skills of Future”platform will greatly help India maintain its competitive edge.”

“Digital technology is now at the heart of every business. Newtechnologies must be embedded in various operations and processes of a businessentity. How can we prepare our millions of small and medium businesses for thistransformation, in a short time? Keeping in mind the importance of innovation, inthe future of economy and business, the Government of India has launched the Start-up India initiative. We believeour startups are the key to finding viable and economical solutions acrosssectors and verticals,” he added.

He also highlighted the Government’s Atal InnovationMission, which seeks to promote a culture of innovation andentrepreneurship and talked about the Atal Tinkering Labs being set up inschools across India. The objective of this scheme is to foster curiosity, creativityand imagination in young minds. They provide dedicated works spaces, with state-of-the-artequipment such as 3D printers, robotics & electronics development tools,IoT & sensors, where students can learn innovation skills and develop ideas.

In the 2018-19 budget, the Indian Government revealeda number of initiatives for the development of emerging technologies in thecountry. The NITI Aayog (NationalInstitution for Transforming India), the premier policy thinktank of theGovernment of India, will initiate a national programme to direct efforts inthe area of artificial intelligence, including research and development of itsapplications.

The Department of Telecom will support establishment of anindigenous 5G Test Bed at the Indian Institute of Technology (IIT), Chennai,while the Department of Science & Technology will launch a Mission onCyber-Physical Systems to support establishment of centres of excellence and toinvest in research, training and skilling in robotics, artificial intelligence,digital manufacturing, big data analysis, quantum communication and IoT. TheGovernment also plans to explore the use of distributed ledger or blockchaintechnology proactively for ushering in the digital economy.

Subsequently, the Government announcedthe establishment of 7 Centres of Excellence (CoE) in new technologies: FinTech(Chennai), IoT (Guwahati and Patna), Virtual Reality (Bhubhaneshwar),Blockchain (Gurugram), Medical Technology (Lucknow) and Electronics Products(Bengaluru).

Building a skilled workforce would play a critical role inthe success of these initiatives and this new initiative could play animportant role in the area.

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‘Future Skills’ platform launched to upskill technology professionals in India

India’s Prime Minister, Mr Narendra Modi, announced thelaunch of the ‘Future Skills’ platform while addressing the World Congress onInformation Technology, jointly organised by NASSCOM, World InformationTechnology and Services Alliance (WITSA) and the State Government of Telnaganathrough a video link on February 19. The aim of the platform is to upskill InformationTechnology professionals in emerging technology areas.

NASSCOM, a not-for-profit industry association, is the apexbody for the 154 billion dollar IT BPM industry in India. NASSCOM has signed anagreement with the Ministry of Electronics and IT (MeitY) for strengtheningre-skilling initiatives and identified eight important technologies it will focuson to prepare people for jobs of the future: Artificial Intelligence, VirtualReality, Robotic Process Automation, Internet of Things, Big Data Analytics, 3DPrinting, Cloud Computing, Social and Mobile. It has also identified 55 jobroles that are expected to be in high demand globally.

According to a reportin Livemint, NASSCOM president R. Chandrashekhar said that the platform aimsto skill and up-skill about two million technology professionals and skillanother two million potential employees and students over the next few years.

Previously, in 2015, the Indian Government launched the NationalSkill Development Mission to ensure adequate availability of skilled workersand enable the country’s existing workforce to be able to re-skill and adapt tothe emergence of disruptive technologies.

PM Modi said, “I am sure, the “Skills of Future”platform will greatly help India maintain its competitive edge.”

“Digital technology is now at the heart of every business. Newtechnologies must be embedded in various operations and processes of a businessentity. How can we prepare our millions of small and medium businesses for thistransformation, in a short time? Keeping in mind the importance of innovation, inthe future of economy and business, the Government of India has launched the Start-up India initiative. We believeour startups are the key to finding viable and economical solutions acrosssectors and verticals,” he added.

He also highlighted the Government’s Atal InnovationMission, which seeks to promote a culture of innovation andentrepreneurship and talked about the Atal Tinkering Labs being set up inschools across India. The objective of this scheme is to foster curiosity, creativityand imagination in young minds. They provide dedicated works spaces, with state-of-the-artequipment such as 3D printers, robotics & electronics development tools,IoT & sensors, where students can learn innovation skills and develop ideas.

In the 2018-19 budget, the Indian Government revealeda number of initiatives for the development of emerging technologies in thecountry. The NITI Aayog (NationalInstitution for Transforming India), the premier policy thinktank of theGovernment of India, will initiate a national programme to direct efforts inthe area of artificial intelligence, including research and development of itsapplications.

The Department of Telecom will support establishment of anindigenous 5G Test Bed at the Indian Institute of Technology (IIT), Chennai,while the Department of Science & Technology will launch a Mission onCyber-Physical Systems to support establishment of centres of excellence and toinvest in research, training and skilling in robotics, artificial intelligence,digital manufacturing, big data analysis, quantum communication and IoT. TheGovernment also plans to explore the use of distributed ledger or blockchaintechnology proactively for ushering in the digital economy.

Subsequently, the Government announcedthe establishment of 7 Centres of Excellence (CoE) in new technologies: FinTech(Chennai), IoT (Guwahati and Patna), Virtual Reality (Bhubhaneshwar),Blockchain (Gurugram), Medical Technology (Lucknow) and Electronics Products(Bengaluru).

Building a skilled workforce would play a critical role inthe success of these initiatives and this new initiative could play animportant role in the area.

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Blockchain and IoT edge connected by Filament chip

Filament blockchain primitives on board

Like Bluetooth chips that provide devices with complete wireless capabilities in one stroke, Blocklet Chip gives a manufacturer or vendor distributed ledger capabilities and a trusted data store, where encryption keys and certificates can be stored. With these tools, vendors can create devices that make or receive automated micropayments, or that can cryptographically attest to the authenticity of sensor readings. Devices such as smart electric meters could, therefore, manage their own cryptocurrency wallets and make micropayments for electric services used. And when the local solar grid produces extra electricity, for example, devices could charge other meters to which the locally produced power was sold.

We can have two different manufacturers transact directly with each other because the blockchain is the intermediary that’s powerful. Finally, we’re there.
Allison Clift-JenningsCEO, Filament

“What we’re really doing now is the sci-fi part,” Clift-Jennings said, “bringing about

economic capabilities so that machines can not only be data-driven, but they can also be economically driven.”

Jessica Groopman, a founding partner at analyst group Kaleido Insights, based in San Francisco, called the new chip “an important proof point in the blockchain and IoT narrative, because it offers a novel design configuration addressing the issue of scalability,” which she said is the top barrier to blockchain use in connected environments and a primary reason blockchain and IoT don’t mesh well.

“Just as edge computation and analytics have evolved rapidly to address scalability in high data volume, high-security and mission-critical IoT environments, the same dynamics will force blockchain to the edge,” Groopman said. She added that “these pressures are forcing focus on development in these areas, but we’ll likely see only [proofs of concept] for some time.”

Clift-Jennings, not surprisingly, had a more bullish view of her company’s announcement. “The benefit of Filament is that it solves the core engineering problem that we’ve had our own struggle with internally [when] deploying keys on devices. Now, we can do the cool things, the economic things, because now we have root of trust. We can have two different manufacturers transact directly with each other because the blockchain is the intermediary that’s powerful. Finally, we’re there.”

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Connecting AI and IoT with blockchain-based platforms

Connecting AI and IoT

Connecting AI and IoT involves trust issues because the internet of things relies on sensors and infrastructure that exist far beyond the realm of data centers — reaching into homes and vehicles, as well as public and remote spaces.

The model evolving around AI and IoT is “akin to a human being in that the IoT devices are the sensors like eyeballs, hands and ears located away from the brain, which does the processing in a data center somewhere far away,” Casado said.

Why keep the processing within a data center? Because “it has the storage and computational power you require,” Casado explained. “But then you need to connect the ‘eyes, hands and ears’ to the ‘brain’ within a data center in a secure way. There are many ways to securely connect these devices to the brain. Blockchain is just one of many — its primary value is providing a particularly paranoid security model for connecting devices to AI. Many IoT use cases don’t require that level of trust, but blockchain allows you to prevent a device from becoming a bad actor.”

If, for example, your IoT system involves a pole-mounted camera within an agricultural context somewhere out in a remote field, “it won’t necessarily have a protective boundary,” Kind pointed out, whereas “data centers have physical security with cybersecurity — firewalls and intrusion detection systems — so they’re somewhat protected. The distributed nature of IoT makes it much more difficult to protect.”

Some future applications will demand more security. “Cars are becoming more instrumented, outfitted with hundreds or thousands of electronic control units (ECUs), and will increasingly become ‘in charge’ of the entire safety of the car,” Kind said. “This, in turn, relates to software updates on ECUs, because the firmware must be updated for its communication and transactions.”

As cars become much more autonomous, and particularly for consumers in car-sharing situations, “you won’t expect to need to pay for tolls or parking because it will become a mobility service,” Kind added. “Cars will need to handle payments and transactions.”

If a car is idling at a traffic light, for example, it may need to negotiate with nearby companies that have solar panels on rooftops to figure out which of these companies can provide the cheapest energy within the three seconds of idling. “So, there’s an increasing need for trusted transactions at the edge,” Kind said. “Blockchain provides exactly the sort of fabric required for these trusted transactions.”

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Blockchain And IoT Will Have A Profound Impact In The Way We Live And Work: PM Modi

Reiterating Finance Minister’s take on blockchain technology, PM Modi while speaking at WCIT India 2018stated, “Disruptive technologies such as Blockchain and the IoT, will have a profound impact in the way we live and work. They will require rapid adaptation in our workplaces.”

pm modi-blockchain

pm modi-blockchain

The NITI Aayog, along with blockchain experts, is already working to prepare an initial document exploring blockchain technology as well as its importance in bringing transparency and applications in e-governance. The initial document-cum-white paper, which is supposed to be online in about a month’s time, will further invite suggestions from the readers.

NASSCOM To Fuel Skill Development For Disruptive Technologies

At WCIT India, NASSCOM also launched a platform for skill development in eight varied technologies – starting with AI. The other technologies in focus will be virtual reality, robotic process automation, IoT, big data analytics, 3D printing, cloud computing, social and mobile.

This is aimed at up-skilling 2 Mn technology professions and skilling another 2 Mn potential employees and students over the next few years. The platform – FutureSkills was unveiled by PM Modi, who applauded the initiative and its focus on creating skills for future jobs in the country.

Seconding PM Modi’s view, Ravi Shankar Prasad, Minister of Law and Justice and Electronics and IT, Govt. of India said, “Digital empowerment can only happen if there is digital inclusion. With the advent of new technologies like AI, Blockchain and IoT, reskilling of young professionals is critical. I’m pleased that NASSCOM has come up with this unique platform for skilling and reskilling young people where my department and team will provide a lot of support and assistance.”

The minister further said that it is all about teamwork where government and private sector leaders and organisations like NASSCOM need to come together and contribute towards digital inclusion.

He further added, “The platform for re-skilling and up-skilling of the workforce in new and emerging ICT technologies is a complement to Digital India initiative of the Government. While Digital India is working on steps to increase domestic electronic production, BPO promotion schemes for employment, this platform will make talent available for India and the Indian industry to embrace opportunities from emerging technologies”.

The Blockchain Project For E-Governance

Speaking to Inc42, Aalekh Sharan, Officer On Special Duty (OSD), NITI Aayog had informed that the NITI Aayog is closely working on blockchain frameworks that include solving the issues such as how it can be useful, cost-effective, efficient and transparent – for various government departments.

The blockchain project or the white paper that NITI Aayog is working on is a completely separate project from cryptocurrencies, said Aalekh. Cryptocurrencies come under the finance department and RBI’s purview.

Among the states which are already on their way exploring potential blockchain and IoT like technologies’ applications in e-governance are Karnataka, Telangana, Andhra Pradesh and Maharashtra. Kerala has even established a ‘Blockchain Academy’ to explore its potential. The central government’s push on blockchain will further help these and the other states in adopting the blockchain technology further.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.

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Open source intelligent solutions to transform work, businesses

Thomas di Giacomo, SUSE CTO.

Thomas di Giacomo, SUSE CTO.

New trends are opening up new opportunities and new ways to deal with IT, according to Thomas di Giacomo, SUSE CTO, speaking at the SUSE executive roundtable, which the open source company hosted in partnership with ITWeb last week.

There are many new and innovative technologies that can help IT leaders meet these new demands, he added. Open source based technologies have become the driving force behind most of the technologically disruptive innovations, said Di Giacomo.

“It is pretty clear that all the new innovation is coming from open source.

“For example, open source progress with Linux and virtualisation a couple of decades ago, cloud in the last 10 years, and more recently, containers for applications, software-defined infrastructure, and platform-as-a-service, empowering DevOps principles.”

However, these trends also present some new challenges, said Di Giacomo. Compared to a couple of decades ago, the number of open source projects today has skyrocketed – from hundreds in the different foundations like the Linux Foundation, Apache, Eclipse and others, to millions of projects on Github.

But, this makes it difficult for companies to assess the open source projects that are relevant to their needs, mature, stable and viable, as well as how to deploy them in their existing infrastructure while allowing future new technologies to be used, he added.

“This is where SUSE can help companies leveraging and benefiting from open source to solve their business needs and deliver more value to their customers.”

Artificial intelligence, IOT challenges

Di Giacomo also noted that technologies like adoption of the Internet of things and artificial intelligence (AI) represent the main challenges facing business today.

Gartner predicts in 2018 new open source intelligent solutions are set to change the way people interact with systems and transform the very nature of work.

It says over the next few years every app, application and service will incorporate AI at some level. AI will run unobtrusively in the background of many familiar application categories while giving rise to entirely new ones, adds Gartner.

AI has become the next major battleground in a wide range of software and service markets, including aspects of enterprise resource planning, says Gartner.

Therefore, it has become absolutely critical to build new IT and application infrastructure, or improve on existing ones to provide real business value to organisations and support its future, said Di Giacomo said.

He noted companies must start looking at ways to effectively combine the emerging technologies with current and future required infrastructure.

“Technology trends impact everyone, no matter what industry you are in. For instance 3D printing is impacting the housing industry with the ability to now print cement houses or in healthcare with the ability to print prosthetics. Big data, analytics and artificial intelligence is impacting retailers giving them the ability to understand your likes and dislikes based on your buying history.”

Adopting one or several of those trends, often referred to as digital or IT transformation, is highly demanding on a company’s software and infrastructure, said Di Giacomo.

This puts pressure on those individuals in organisations responsible for creating, deploying and maintaining the software and IT infrastructure, he added.

These individuals have to respond to the new demands to speed up time-to-market for new applications, be more agile in providing IT resources, managing this more complex environment and ultimately enabling the business to deliver better quality products and services, said Di Giacomo. “They must do all this while controlling if not reducing costs.”

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