Artificial Intelligence (AI) is often feared. A lot of people believe that it is a sign of robots, job losses, or the feeling of being out of control. Understandably, AI is a rapidly evolving technology, but it is not always a safe bet. However, when it comes to personal financial planning and credit creation, AI is quietly becoming one of the most useful tools in the world today.
Credit scores are an important aspect of your financial profile. It affects the likelihood of you being able to rent an apartment, take out loans, or get the job you want. However, improving your credit score can be a bit confusing, particularly when the credit score is stuffed with confusing terms and unclear changes. This is where AI comes in. Instead of replacing human decision-making processes, it improves them by providing real-time information, extensive financial information, and personalized advice that a lot of people couldn’t otherwise have access to.
For instance, AI can scan your credit report within a few seconds and highlight errors that might otherwise be overlooked. Incorrect balances or accounts that aren’t related to yours, inaccurately reported late payments, can damage your credit score for a long time. With AI, you can get automatic detection, immediate alerts, and even suggestions to dispute, which makes fixing the issues more efficient and quicker.
AI assists by analyzing your individual financial habits, not offering general guidance. Instead of saying “pay your bills on time,” intelligent tools could provide advice such as: “Make a small payment before your statement closes this month to reduce your utilization ratio,” or “Your credit age is low–avoid applying for new cards for now.” This is a more intelligent type of advice and is based on your own knowledge, not just one-size-fits-all tips.
The most potent applications of artificial intelligence is their ability to model the future. What happens if you have paid off a credit card in the next month? What if you made a mistake in a payment? Artificially powered score simulators reveal the possible impact of your choices before you decide to make them. This type of knowledge could be an important factor for anyone looking to build credit with no negative consequences.
In addition, since the process of improving credit scores is an ongoing goal, AI offers tools to assist you in staying on the right track. It will send you reminders for payments, inform you that you are using credit when it is high, and also look for indicators of fraud. Certain platforms can even aid you in negotiating better terms with lenders, such as raising the credit limit of your account or lowering your interest rate. Both of these will improve your score.
Although the concept of AI may be overwhelming but the truth is this: It’s an instrument. It’s a powerful one. When used properly, it can open the way towards financial independence. With a broad range of knowledge as well as real-time tracking and a behaviour-based approach to guidance, AI is helping more people manage their credit. Not by taking care of everything, but by making the process easier, quicker, more efficient, and easily accessible.
TomoCredit now provides an AI-powered checkup on your financial health, which helps you assess your credit rating, identify mistakes, and make your next steps with confidence.
The next time you see “AI,” don’t think of it as something you should be afraid of. Consider it as a coach, an adviser, and a guide that could just aid you in building a stronger credit score and a better financial future.
