| How AI is Shaping the Future of Global Remittances

How AI is Shaping the Future of Global Remittances

How AI is Shaping the Future of Global Remittances

The AI revolution is well underway.

After decades of development—and billions of dollars in investment—artificial intelligence (AI) has officially gone mainstream. 

According to Microsoft founder Bill Gates, AI is “as fundamental” as the internet itself.

“It will change the way people work, learn, travel, get healthcare, and communicate with each other,” Gates affirms. “Entire industries will reorient around it. Businesses will distinguish themselves by how well they use it.”

The question is, how will AI shape the future of global remittances? 

While the potential is tantalizing, the immediate applications are less certain. 

In this article, we’re going to review the origins of AI, discuss its long-term potential, and identify the obstacles AI must overcome before it can power the payments industry. 

What Is Artificial Intelligence?

In 1950, famed English mathematician Alan Turing posited an earth-shattering question:

Can machines think?

The query itself birthed the artificial intelligence movement and baptized Turing as “the father of computer science.” 

While mathematicians ran with the proverbial AI football, science fiction writers vividly imagined AI dystopias in iconic books and movies (including The Terminator). 

Though AI takeover conspiracies remain in vogue, most businesses and consumers are currently focused on a simpler goal: understanding and harnessing the artificial superpower. 

There’s no shame in admitting that AI can be difficult to grasp, especially with its dense technical jargon.

So: what is artificial intelligence? 

AI is an umbrella term that houses subfields including “weak” and “strong” AI, machine learning, deep learning, and generative models. 

Though each of these terms are highly nuanced, they all share the same foundational focus:
AI systems can “learn” from large amounts of data and make statistically-probable predictions from those data patterns

Meet ChatGPT: An AI Example

This brings us to ChatGPT, the new “face” of artificial intelligence in 2023. 

ChatGPT is an AI chatbot powered by large language models (LLMs)—i.e., state-of-the-art machine learning tools that allow the chatbot to converse with human levels of precision and empathy. 

You can ask the bot a complex question, and just as soon as you finish typing, ChatGPT will provide an equally complex answer. 

How does it do that? In short, by being pre-trained to ingest enormous amounts of data from an infinite pool of resources. 

Just like a student, ChatGPT learns linguistic patterns, grammar, context, and idioms to deliver the information as if it was written by a scholar in a particular field. 

But here’s the catch: whereas a scholar has read perhaps fifty books related to his or her field of expertise, ChatGPT has probably read all of the books related to that subject (and every subject adjacent to it). In fact, it has probably read every book related to every subject ever. 

By the way, the “GPT” in ChatGPT stands for “Generative Pre-trained Transformer.” 

The term “generative” simply means that the technology is capable of endlessly generating brand new content based on its data sets.

While ChatGPT provides textual responses, other AI systems—like DALL·E 2—can create realistic images and artwork from just a few keyword prompts. 

Curious how Rembrandt would have painted Batman? You can find out here

Note: OpenAI, the company that built ChatGPT, was founded and financed by a number of powerhouse innovators including Sam Altman, Peter Thiel, and Elon Musk. In January of 2023, Microsoft invested a whopping $10 billion in ChatGPT.

Is AI Necessary in the Remittance Industry?

Every sector stands to benefit from generative AI, particularly the payments ecosystem.

At UniTeller, we’re hopeful that AI can further our mission to connect the world with payments in an affordable, secure, and efficient manner.

We’re equally hopeful that AI technology can address longstanding problems plaguing global remittance industry. As we frequently discuss, the cost of remittances is simply too high.

According to recent studies, the average remittance costs 6.3% of the total amount sent—more than double the 3% cost as outlined in the UN’s Sustainable Development Goals. Reducing remittance costs to 3% globally would save consumers over $20 billion per year.

Security is an equally important concern. At UniTeller, we are watching intently to see how AI promotes end-to-end efficiency at each stage of the money transfer process. After all, convenience is crucial in the digital age.

Overall, we’re excited to see how generative AI evolves the remittance industry. 

Challenges and Ethical Considerations of AI

While ChatGPT has captivated the world, enthusiasm has thus far outpaced understanding. 

In other words, although there are many exciting use cases for generative AI, most business sectors don’t know how to implement it.

Make no mistake, this promethean technology has the capacity to both build and burn. 

The first casualty? Jobs. Lots of jobs. 

In fact, estimates suggest AI could displace over 85 million jobs in the next two years. 

Unsurprisingly, this reality is unsettling to many workers, including the Writers Guild of America (WGA), which is on strike partially because of looming AI concerns

Beyond the devastating financial impact, AI must also answer to a host of bias and misinformation concerns. 

Where is the chatbot sourcing its data? And how can you determine its legitimacy? 

If algorithms are trained to “learn” certain information, they will naturally develop opinions and worldviews—just like a human being who reads a certain cache of books or articles. 

Bias is inevitable for individuals, but unprecedented for technology. 

That’s one reason the World Health Organization issued an official warning against potential biases in platforms like ChatGPT. After all, if the AI is learning from humans, and humans are biased, the artificial intelligence will inherit that bias. 

Juvenal’s two-thousand year-old question remains more relevant than ever: “Who watches the watchmen?” 

Some biases will be acceptable, while others will be verboten. 

Security Considerations

This brings us to another sticking point: security

After all, if generative AI systems are harvesting and processing galaxies of public and personal information, the risk of cybercrime skyrockets. 

In fact, OpenAI has already confirmed a data breach within ChatGPT. 

It’s also worth mentioning that generative AI specializes in approximation, regurgitation, plagiarism, and yes, impersonation. “Deepfake” technology is (largely) a source of laughter now, but it could be a source of pain later. 

Even Tom Hanks is wondering what it all means, saying, “I could be hit by a bus tomorrow and that’s it, but my performances can go on and on and on.”

At some point, artificial intelligence will infringe on human sanctity. 

Then again, individuals aren’t the only ones with questions. Corporations are equally concerned.

Indeed, many companies worry that AI technology could create fake profiles (and images) while using legitimate personal and financial information.

After all, one wrong keystroke entered into a chatbot instantly becomes part of the endlessly expanding (and therefore hackable) universe of information.

According to Mark McCreary, co-chair of data security at law firm Fox Rothschild LLP, “You don’t know how [user information] is going to be used. I think the opportunity for company trade secrets to get dropped into these various AI’s is just going to increase.”

That’s why JPMorgan Chase won’t allow its employees to use ChatGPT.

Ultimately, the security of generative AI will depend on the gatekeepers who filter out personal data and ensure proprietary information is kept safe.

Then again, if the gatekeepers are part of the machine itself, we will become fully dependent on AI to safeguard our privacy.

In that scenario, artificial intelligence then becomes the definitive intelligence. 

3 Ways AI Could Improve Global Remittances

Generative AI is clearly an emerging technology. 

As such, the fruit of its potential applications can only be speculated upon, rather than guaranteed at this juncture. 

Nevertheless, we anticipate that artificial intelligence will help improve global remittances in three key areas, including:

1. Enhanced Customer Service

While AI is dominating headlines, it has been around far longer than many realize. 

After all, AI is the underpinning technology that powers Apple’s Siri, Amazon’s Alexa, and the countless chatbots populating e-commerce websites. 

As helpful as those technologies have been, their usage is extremely limited—especially compared to advanced platforms like ChatGPT. 

With generative AI, virtual remittance assistants will provide 24/7 customer support in ways no human being could match. In fact, AI platforms will be able to do things like capture payment, process remittances, and predict delivery dates—entirely free from human error. 

After all, remittance chatbots will be trained on extensive data sets that equip them to instantly provide answers that would take an individual employee hours (or even days) to address.  

Customers will not only receive the most accurate (and recent) information, but they will receive it faster than ever before. 

Note: While enhancing the user experience, generative AI may also promote financial inclusion on the world stage. Given the relative affordability of AI platforms, such technology can reach many underbanked and unbanked populations, here in the U.S. and abroad.

2. Early Fraud Detection and Prevention

When it comes to digital payments and remittances, security is paramount. 

As cybercriminals get increasingly creative, fraud detection systems must be equally adaptive. 

Putting the security concerns raised in the section above aside for a moment, generative AI tools could provide the definitive solution to remittance security—and save countless dollars and billable hours in the process.

Rather than using old spreadsheets or database queries, imagine asking a chatbot complex questions like, “What are the biggest fraud trends in remittances sent to Latin America?” 

Or, you could ask a chatbot to “Summarize all suspicious payments in the last six months.”

While this information would take days to physically catalog, AI could instantly deliver key information to a fraud manager and stop data breaches long before they happen.

3.   Reduced Overhead Costs (+ Streamlined Exchange Rates)

Exchange rates are constantly in flux. 

While it can be difficult to keep up with the latest numbers, generative AI could provide real-time currency updates to customers.

This would eliminate ambiguity in pricing and give consumers greater flexibility (and purchasing power) wherever the funds are sent or received. In other words, generative AI will help put wealthy countries and developing nations on a more level playing field. 

Finally, AI has the potential to automate low-value (and time-consuming) tasks like calculating costs, invoice processing, and managing accounts payable. 

Generative AI could improve the reporting process on every internal front, freeing overburdened staff from repetitive tasks and allowing them to focus on more essential assignments. 

Again, generative AI will not only liberate employees from mundane work, but it will dramatically reduce the risk of human error—which often carries its own short and long-term costs. 

The Future of Remittances

While the AI revolution is well underway, technology, potential applications, and the ethical debate is constantly evolving as well.In the meantime, we are dedicated to providing our customers with a state-of-the-art cross-border payment platform. At UniTeller, we are fully invested in delivering a secure, affordable, and accessible product to our partners around the globe.

After all, when it comes to transferring money, UniTeller maintains high standards of excellence. As a fully-licensed money transmitter in the United States and soon to be in Canada, UniTeller remains intensely committed to providing payment services with a transparent and flexible business model that’s trusted by countless customers and business owners.

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