How AI is Being Used in Other Industries – Financial Advisory
By, Piers Lee, Managing Director, Novema Pte Ltd.
November 2025
As Novema researched the application of AI in consumer insight, it was useful to compare how AI is being used in other industries, e.g. to assess whether similar opportunities and challenges are encountered. Hence, we interviewed firms in several other industries where AI is currently being used.
All the companies interviewed for this research using AI in their own firms, and all have dedicated departments to optimize the use of AI within their organisations, although sometimes this is part of a larger ‘digital team’ looking at a range of tech applications.
They all recognize the need to have these departments for fear of being ‘left behind’, i.e. they are all acutely aware of how transformative AI will be for their industries and need to be at the forefront of these technological developments or at least try to!
Financial advisory
Financial markets generate enormous volumes of intricate data at unprecedented speeds, making AI a valuable tool for extracting insights similar to those in consumer research, such as detecting trends, correlations, and sentiments, to assist advisors in developing investment strategies and client portfolios.
Much like consumer insights, AI can integrate data from various sources, including annual reports, news articles, and market research documents.
Furthermore, advisory firms can leverage AI to attract new clients, manage customer databases for improved relationship management, and tailor strategies to align with clients’ financial objectives and risk tolerance.
Additional uses encompass fraud detection, such as identifying money laundering activities, and ensuring regulatory compliance to prevent costly penalties from breaches.
While AI holds significant untapped potential in financial markets, current predictive analyses rely heavily on historical data patterns, which are cautioned against as sole indicators of future performance. Nevertheless, substantial investments are expected to enhance AI’s predictive capabilities, promising clear advantages for investors.
But like the consumer insight industry, financial advisory firms might become over-reliant on AI, with loss of accountability & transparency. The disadvantages include:
Excessive dependence on technology: Much like consumer insights, overusing AI may undermine advisors’ critical thinking and analytical capabilities.
Bias: AI systems can inherit biases present in their training data, potentially disadvantaging certain customer groups, such as underrepresented minorities, due to insufficient data to adequately serve them.
Lack of accountability: The use of opaque, black-box solutions reduces transparency, making it difficult to justify recommendations to clients. Without adequate human oversight, this could result in suboptimal strategic decisions.
Challenges in customer experience: Transitioning to chatbot advisors may lead to client frustration, potentially harming customer satisfaction and loyalty.
Data privacy concerns: The use of AI involves managing vast amounts of sensitive personal and financial information, which raises substantial privacy and security risks, including potential data breaches and vulnerabilities to hacking and cyberattacks.
Financial implications: Implementing AI technologies and addressing the related risks require considerable investment, posing challenges for smaller organizations.
But AI is transforming the financial advisory industry by enhancing efficiency, improving client services, and providing deeper insights into market trends, all of which complements the human financial advisor.
