The Role of Artificial Intelligence in FinTech as a Catalyst of the Economic Growth Drive in Africa

The Role of Artificial Intelligence in FinTech as a Catalyst of the Economic Growth Drive in Africa

Ranson Sifiso Gwala, Shaherbano Ijaz
Copyright: © 2023 |Pages: 19
DOI: 10.4018/979-8-3693-0082-4.ch005
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Abstract

The purpose of this research was to examine the effects of artificial intelligence of financial technology (FinTech), digitisation, and the growing influence of the fourth industrial revolution in Africa as a catalyst for economic growth. This study used a desktop literature review approach on the latest peer reviewed journal articles on how digitalisation is influenced by the fourth industrial revolution in Africa. The findings of the study confirmed that FinTech and digitalisation are the ongoing processes that is taking shape daily in in the African continent led by traditional financial institutions and new FinTech startup companies. This is disrupted by new players who are using FinTech to simplify the complexity of the banking system. This is fuelled by the newly available technologies that FinTech uses to provide better and speedier financial services. However, there is also a growing gap between the poor and the rich, as well as the extent to which the poor access and benefit from the quantum leap in FinTech due to technology inhibitors in Africa.
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3. The Literature Review

Due to the effects of the fourth industrial revolution and Industry 4.0 technologies, the digital economy has expanded dramatically on a global scale. Throughout the years, internet activity has increased dramatically in many developing nations, and Africa is no exception. The COVID-19 epidemic caused the fourth industrial revolution adoption to pick up speed (Gwala & Mashau, 2022, 2023). Digital financial services (DFS) have increased as a result of the booming digital economy in Africa and other emerging nations (Mpofu & Mhlanga, 2022).

Algorithms assist with decision-making in many areas, including healthcare, predictive justice, facial recognition, fraud detection, employment, and admittance into higher education (Slaughter et al., 2020). Artificial Intelligence, (AI), is acknowledged to have the ability to increase consumption, increase cross-sector productivity, and improve risk management, to name a few. AI is associated with the threat of employment displacement by technology, the potential for skills retraining, the widening digital divide, and, more generally, the tendency towards transhumanism, or the transformation of mankind through technologically improved capacities. (Sadok et al., 2022).

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