AI EDUCATION: What is the Difference Between Artificial Intelligence & Machine Learning (AI/ML)?


We thought it would be interesting for our readers to get a good grasp on the definitions of “artificial intelligence” and “machine learning” in a short, crisp overview.  They’re definitely inter-connected, but not quite the same, and  yet you consistently see “AI/ML” presented together all the time.

Below is a very brief, easy to read, explanation of each, some examples of finserv companies utilizing the technologies for differing reasons, along with sources that include links, if you choose to research the topic further.

Artificial Intelligence (AI) is a branch of computer science that aims to create systems capable of performing tasks that require human intelligence. These tasks include reasoning, learning, problem-solving, and more. AI is implemented in machines to perform tasks that actually require human intelligence. For example, AI is used in the financial industry to streamline and optimize processes ranging from credit decisions to quantitative trading and financial risk management.

Machine Learning (ML), on the other hand, is a subset of AI that focuses on the use of data and algorithms to imitate the way that humans learn, gradually improving its accuracy. ML is used in process automation in corporate finance. Additionally, it helps financial companies automate menial tasks such as data input and financial monitoring.

ML also uses algorithms trained on data sets to create models that enable machines to perform tasks that would otherwise only be possible for humans, such as categorizing images, analyzing data, or predicting price fluctuations.

Put another way, the primary differences between AI and ML lies in their scope and applications.

  • AI is the broader concept of enabling a machine or system to sense, reason, act, or adapt like a human, while….
  • ML is an application of AI that allows machines to extract knowledge from data and learn from it autonomously.

In the financial services industry, AI and ML have numerous applications and the following companies highlight just a few who claim to use machine learning.

  1. Enova, which defines itself as “leading financial technology company that provides online financial services through our machine learning-powered Colossus™”, uses AI (and clearly machine learning as well) in its lending platform to provide advanced financial analytics and credit assessment.
  2. Ocrolus offers document processing software that uses AI-driven processes for the loan industry. The software allows businesses, organizations, and individuals to increase speed and accuracy when analyzing financial documents.
  3. Companies like Capital One use ML in personal finance applications. Their tool, Eno, a chat tool available as a mobile app, which they define as “your Capital One assistant”, generates insights and anticipates customer needs with services like helping keep client accounts secure, spending tracking, etc.

These are just a few examples of how AI and ML are utilized within the financial services industry. They help in enhancing customer experience, improving decision-making, and increasing operational efficiency.

AI & Finance prublishes a column covering the most important news in the industry, and each week we feature a dozen or more companies using AI within the financial services sector, in numerous different ways!  Check it out here!

DWN Team & CoPilot


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  20. Machine Learning vs Artificial Intelligence: What’s the Difference?