A review article: -the Growing Role of Data Science and AI in Banking and Finance

Abstract

Data science and artificial intelligence (AI) have been rapidly transforming the banking and finance industry, revolutionizing various processes and decision-making mechanisms.This paper provides an overview of the increasing significance of data science and AI in the financial sector, highlighting their applications in risk management, credit scoring, customer insights, fraud detection, algorithmic trading, and more.While these technologies offer immense potential, their implementation poses several challenges.The paper discusses key challenges faced by financial institutions, including data quality and availability, data privacy, regulatory compliance, ethical concerns, lack of skilled talent, and integration with existing systems.It emphasizes the need for interpretability and explainability in AI models to gain stakeholders' trust and comply with regulatory requirements.Moreover, the importance of data governance, bias mitigation, and addressing resistance to change are underscored.As the future of data science and AI unfolds, this paper proposes several promising research directions.It advocates for the development of explainable AI (XAI) techniques to enhance transparency and facilitate effective decision-making.Additionally, the potential of federated learning in enabling secure collaboration among financial institutions while preserving data privacy is explored.Research efforts in AI for regulatory compliance, ethics in AI and finance, and advanced data privacy and security solutions are encouraged to safeguard customer data and ensure responsible AI use.

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