Artificial Intelligence (AI) has seamlessly integrated into both our personal and professional lives. However, its ascent began well before the introduction of the AI generative tool ChatGPT, with IBM’s Watson marking a pivotal moment. Renowned for its triumphant victory over Ken Jennings, the esteemed Jeopardy host, in a historic match, Watson represented an early vision into Natural Language Processing.
Initiated in 2006 and occupying the space of a conference room, it demonstrated its power by rapidly executing millions of lines of code. Following its Jeopardy victory in 2011, IBM pivoted Watson’s capabilities toward the zenith of healthcare challenges—Cancer Research. The ambition was to harness Watson’s AI to model through extensive databases of cancer research, genetic data, and diagnostics in pursuit of conquering one of the most formidable diseases of our era.
After several years of investment, the billion-dollar medical venture was ultimately deemed unsuccessful, leading IBM to discontinue the project. One of the key factors to its demise was high costs. Furthermore, the medical community found the sourced material underwhelming, criticizing its inefficiency in practical patient care. One can’t help but believe IBM mishandled its technology at the time, and the once-emerging IBM Watson has officially timed out.
Fast forward to November 30th, 2022, the AI market shifts dramatically with the beta release of ChatGPT by OpenAI. Within months, the generative AI explodes in its user base and technology across the world, sparking an arms race for AI across all major tech enterprises.
Within a mere 15 months, the market has witnessed the proliferation of numerous AI tools spanning generative imagery, music composition, digital artistry, conversational bots, and network programming, launching an era of the AI revolution.
This surge in AI holds several implications for the Merchant Cash Advance (MCA) and Alternative Lending sector. Currently, these technologies are being employed for rapid analysis of banking statements, email marketing campaigns, customer support services, and the drafting of legal documents. The industry is undergoing a rapid transformation, and all businesses should take notice and adapt to leverage these advancements. The most affluent and resourceful firms are investing heavily in AI to develop groundbreaking financial technology products. The antiquated firms may be challenged by new financial products in the coming months. How will MCA respond?
The potential for AI to supplant numerous roles within the MCA space is considerable. The necessity of maintaining a six-person underwriting team is being reevaluated, as AI technology enables files to be processed with speed and precision. AI’s lack of emotional bias, coupled with its attention to detail, challenges the traditional operational model that financial companies have used for decades. While the need for human oversight remains clear, the junior underwriters, sales assistants, and customer service representative roles are being reconsidered.
As AI reshapes the MCA landscape, we must contemplate the future of the workforce. How do we reposition or repurpose roles that AI may render redundant and inefficient? How do we keep pace with firms leveraging millions on tech for new and innovative finance programs? The ongoing evolution driven by artificial intelligence is inevitable; it’s here to stay, and we’re only in its infant stage of life.
