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Artificial intelligence is being employed across the payment sector

Utilizing Artificial Intelligence in Payment Services: A Global Perspective - Showcasing Application in Fraud Prevention and Marketing, with Illustrations from Visa and Klarna

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AI is being utilized extensively within payment sectors
AI is being utilized extensively within payment sectors

Artificial intelligence is being employed across the payment sector

Article Title: The Rise of AI in the Payment Industry: Enhancing Efficiency and Customer Experience

In the ever-evolving world of finance, Artificial Intelligence (AI) is making significant strides, particularly in the payment industry. Companies, both in the US and Europe, are leveraging AI to revolutionize the way they operate, ensuring regulatory compliance, streamlining transactions, and providing a seamless customer experience.

Personalized Customer Interactions and Payment Experiences

AI is powering personalized checkout experiences, adapting payment options to individual customer behaviour and preferences. This tailored approach makes payments easier and smoother, enhancing customer engagement (Appinventiv 2025 [1], Host Merchant Services 2025 [3]).

Automating Operational Tasks

Small and large businesses are deploying AI to automate bookkeeping, transaction reconciliation, and back-office operations, increasing operational efficiency and reducing costs (Host Merchant Services 2025 [3]).

Regulatory Compliance Automation

AI-driven systems are automating compliance processes such as Know Your Customer (KYC) and Anti-Money Laundering monitoring. By analysing customer profiles, behaviours, and transactions in real-time, these systems identify suspicious activities and keep up with regulatory changes (SoftTeco 2025 [4]).

Customer Service via AI Chatbots

AI chatbots are providing 24/7 personalized customer support, handling inquiries ranging from budgeting advice to product recommendations without human intervention. They also assist in authenticating users via voice or facial recognition integrated into apps, enhancing security and convenience (SoftTeco 2025 [4]).

Smarter Transaction Processing and Decision-Making

AI optimizes payment processing speed and accuracy, supports dynamic risk assessment beyond fraud detection, and transforms how companies interact with payment technology and customers (Appinventiv 2025 [1]).

While fraud and identity theft prevention remain a major focus of AI use, these additional applications help payments companies improve operational efficiency, regulatory adherence, and customer engagement, driving revenue growth and competitive advantage in a challenging market.

Notable Examples

American Express, for instance, uses AI for fraud prevention, credit risk assessment, market data analysis, pricing strategies, product development, market expansion, customer service, and personalized offers. Cashback companies Payback and Rakuten are optimizing their marketing campaigns with the help of AI (SoftTeco 2025 [4]).

Hawk AI offers an AI tool for transaction monitoring that is used by several payment service providers such as Ixopay, Otto Payments, Ratepay, and VR Payment. Qonto has developed its own AI that assists in recruitment by writing job ads and transcribing and analyzing job interviews (SoftTeco 2025 [4]).

Visa has partnered with AI provider ServiceNow to speed up dispute resolution processes. Lemonway, Mastercard, Monei, Riverty, Scalapay, and Treezor are using AI in the areas of KYC and onboarding (SoftTeco 2025 [4]).

Mastercard and Visa have acquired AI providers Recorded Future and Featurespace for fraud prevention purposes. Klarna has replaced some employees with AI to analyze customer behaviour and personalize offers, and has implemented an internal AI assistant named Kiki, which supports employees in communication, marketing, and the legal department, and creates individual contracts for the latter (SoftTeco 2025 [4]).

The workforce at Klarna has shrunk by 22 percent since 2023, partly due to tasks being taken over by AI. This shift towards AI integration is consistent with industry trends towards integrating responsible, customer-centric AI tools in payment ecosystems (AWS 2025 [5]).

While this article has focused on AI's specific applications within payments, it's important to note that AI usage extends beyond these areas, as demonstrated by the examples provided. AI is indeed reshaping the payment industry, one transaction at a time.

References:

  1. Appinventiv (2025). The Future of Payments: How AI is Revolutionizing the Industry
  2. Host Merchant Services (2025). The Role of AI in the Future of Payments
  3. SoftTeco (2025). How AI is Transforming the Payments Industry
  4. AWS (2025). AI and Machine Learning in Financial Services
  5. Financial Times - Various articles on AI in the payments industry.

Fintech companies are integrating artificial intelligence (AI) technology into their business models to automate operational tasks, such as bookkeeping, transaction reconciliation, and back-office operations, which increases operational efficiency and reduces costs.

Additionally, AI is being used to personalize customer interactions and payment experiences, tailoring payment options to individual customer behavior and preferences, ensuring a seamless and engaging customer experience.

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