Generative Artificial Intelligence in Banking and Finance: Market Trends and Growth Opportunities
Dublin, June 03, 2025 (Globe Newswire) – The report titled “Generative Artificial Intelligence (AI) Opportunities and Strategies in Banking and Finance until 2034” is now available on Researchandmarkets.com.
Market Growth Projections
The global market for generative artificial intelligence (AI) in the banking and financial sector is expected to experience astounding growth, projected to rise from $1.29 billion in 2024 to approximately $21.57 billion by 2034. This reflects a compound annual growth rate (CAGR) of 31.64%. Key drivers of this expansion include increasing demand for data security, personalized financial services, and advanced fraud detection capabilities.
Challenges Facing the Industry
Despite its promising outlook, the generative AI sector is grappling with challenges, including a lack of skilled AI professionals and technical expertise. Furthermore, trust in AI systems remains a hurdle. However, underlying factors such as economic growth, urbanization, digital transformation, and government backing are anticipated to drive future progress.
Market Competitors and Regional Insights
The competitive landscape of the generative AI market is relatively fragmented, with the top ten players collectively controlling only 16.45% of the market share in 2023. Microsoft Corporation leads the space with a 2.10% share, closely followed by Google LLC and IBM. North America holds the largest market share at 52.10% in 2024, while South America and Africa are projected to be the fastest-growing regions, with respective CAGRs of 49.47% and 49.05%.
Technological Segmentation and Key Applications
When analyzing technological segmentation, natural language processing is identified as the most significant segment, accounting for 36.89% of the market in 2024, with a projected CAGR of 39.20%. Cloud-based solutions dominate deployment models at 72.29%, expected to grow at a CAGR of 38.22%. Notably, fraud detection applications lead the demand, while trading and portfolio management are anticipated to expand rapidly at a CAGR of 46.32%.
End User Dynamics: Banks vs. Fintech
Banks represent 48.31% of the end-user segment, but fintech companies are likely to accelerate future growth with an impressive CAGR of 40.25%. As the generative AI landscape evolves, opportunities span various technologies, deployment methods, and end-user segments, particularly in the areas of natural language processing and cloud deployments, providing ample investment and innovation potential.
Strategic Recommendations for AI Companies
Industry analysts advise AI-generating firms to focus on competitive pricing strategies, targeted consumer education, and forming strategic alliances to bolster their market position. The contribution of fintech partnerships, alongside exploring opportunities in trading and portfolio management, is expected to unlock substantial growth potential, revolutionizing the financial services industry.
Conclusion
As generative AI continues to redefine the landscape of banking and finance, its applications in enhancing financial documentation and innovative service delivery through low-code solutions are becoming increasingly important. Strategic collaborations and transparency in AI solutions will be pivotal in building trust and driving sector growth. For a deep dive into these trends, visit Research and Markets.