by Apoorva Bellapu
February 5, 2022
If there is one technology that has transformed our lives for the better and holds immense potential in the years to come, it is natural language processing (NLP). The extent to which organizations have benefited from NLP cannot be expressed in words. Of the many industries that NLP caters to, the financial sector seems to be impacted like no other. On that note, take a look at 10 ways NLP is impacting the financial industry in 2022.
Better loan decisions
NLP has played a pivotal role in enabling organizations to make better lending decisions. NLP scans bank statements, payslips, tax documents, mortgage forms, invoices, and more. to determine credit eligibility.
Natural language processing can be used to support the compliance processes of banks and other financial institutions. NLP makes it easy to search through thousands of digital documents, allowing compliance officers to quickly determine if regulations have been met.
NLP has the potential to connect unstructured and structured data, then intelligently transform the data, learning from each interaction and thereby delivering contextual underwriting intelligence.
The financial industry is associated with the analysis of earnings calls to establish the main theme or to compare with previous similar calls to identify trends. This is where NLP comes into play. It can be used to link entities and build a relationship graph. It further helps to detect money laundering and/or fraud.
Natural language processing has been a boon when it comes to creating more demanding and agile models for enterprise protection. These models can identify trends, identify risks, retain workforce and ensure better information for future planning.
Answers to complex financial questions
NLP has made headlines for its ability to answer complex financial questions. It does this with the help of cloud computing. This NLP application is widely used – so much so that global institutions like JP Morgan, Bank of America, Morgan Stanley and S&P Global trust it.
Accounting and auditing
Today, we have reached a stage where companies around the world have realized how crucial NLP is when it comes to gaining a significant advantage in the audit process. With NLP in place, finance professionals can directly identify, target and visualize anomalies in daily transactions.
Predict stock behavior
Given the irregularity and fluctuation of stock prices, it is quite obvious that long-term and seasonal variations can lead to large errors in analysis. However, a combination of NLP and deep learning largely outperforms previous methodologies working with financial time series.
The financial industry has a lot to do with reviewing unstructured content about a particular company to look for inconsistencies and anomalies. NLP is nothing short of a savior here as it can identify potential stock performance signals from thousands of research reports and company transcripts.
Identify financial market trends
NLP has the potential to analyze keyword searches in filings, transcripts, research and news to uncover changes and trends in financial markets. Well, can anything be better than that?
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