The Role of AI in Financial Inclusion: Challenges and Opportunities in the UAE
Financial inclusion is a critical issue that goes beyond just providing access to financial products. True inclusion requires financial literacy, empowering individuals to make informed decisions. Helal Lootah, co-founder and co-CEO of Lune Technologies, a Dubai-based data company, explores the challenges and opportunities of AI in financial inclusion, using the UAE as an example.
Financial literacy is key to improved decision-making in budgeting, spending behavior, financial planning, and recognizing opportunities. A survey found that financial illiteracy costs households an average of $1,800 annually. While traditional advisors and fintechs have made progress, the future of inclusion lies in AI-powered financial technologies.
The rise of digital transactions has added complexity to the financial landscape, making it essential for individuals to have a deeper understanding of personal finance. AI-powered solutions can provide insights and recommendations tailored to individual users, revolutionizing money management.
In the UAE, financial inclusion is a top priority, with the country leading the Gulf region at 46% in 2020. The National Strategy for Artificial Intelligence 2031 aims to capitalize on AI in the financial sector. Collaboration between fintechs and established financial institutions is crucial for these solutions to reach their full potential.
As the UAE strives for sustained leadership in innovative finance and inclusion, open banking and AI will play a pivotal role. Collaboration among ecosystem members will be essential for advancing this agenda and creating unprecedented synergies.
