The New Era of Smart Finance: How AI Financial Inclusion is Reshaping Taiwan’s Financial Services

Connie Tong
1 day ago
4 min read

Following last week’s analysis of Singapore, this concluding article focuses on China Taiwan’s unique path toward AI-powered financial inclusion and industry innovation.

New Opportunities for Financial Inclusion in the Digital Era

Driven by the digital wave, Taiwan’s financial industry is experiencing an unprecedented transformation. AI and data-powered digital banking services are expanding the boundaries of financial inclusion, bringing financial services to more people than ever before.

Financial inclusion emphasizes providing fair and convenient financial services to small and micro enterprises as well as disadvantaged groups. According to the World Bank’s “Global Findex Database 2021,” the account ownership rate among adults in East Asia and the Pacific has reached 83% (World Bank, 2021).

Although coverage is high, some low- and middle-income groups and small businesses in Taiwan still face challenges such as difficult access to credit and high service costs. In recent years, with the acceleration of fintech innovation, the penetration rate of digital financial services in Taiwan has continued to rise. In the first quarter of 2025, the number of digital bank accounts increased by more than 50% year-on-year, indicating a leap in the financial inclusion ecosystem (Yahoo Finance News, 2025-04-25).

Accelerating Fintech Innovation in Taiwan

Taiwan is actively building a fintech innovation ecosystem, with continuous policy and regulatory upgrades. The Financial Supervisory Commission (FSC) is promoting the “Fintech Development Action Plan,” accelerating the construction of open banking, digital identity, and other foundational infrastructures, and encouraging deep collaboration between financial and technology companies (FSC official website).

In the first quarter of 2025, the number of digital bank accounts in Taiwan grew by more than 50% year-on-year. First Bank’s digital account openings exceeded 2 million, and many banks launched high-interest savings and free interbank transfers, driving digital finance penetration to record highs (Yahoo Finance News, 2025-04-25).

By the end of 2024, the number of securities accounts in Taiwan reached 13.216 million, with over 1.8 million accounts opened by people under 30, reflecting young people’s strong embrace of digital financial services (LINE Bank News, 2025-01-03).

AI Empowering Financial Inclusion: Four Key Application Scenarios

1. Smart Lending: Making Financing More Efficient

AI and big data have been deeply integrated into the loan approval process. For example, LINE Bank’s AI risk control system analyzes user behavior and repayment habits in real time, enabling even unsecured customers to enjoy efficient and accurate loan services. Approval processes are significantly accelerated, and lending thresholds are steadily lowered.

2. Smart Customer Service & Financial Education: Services Within Reach

AI-powered customer service enables 24/7 financial support. The “Xiaofeng” AI assistant at SinoPac Bank answers questions about loans, wealth management, and accounts around the clock, with the automated response rate continuously improving and significantly enhancing customer experience (SinoPac Holdings 2023 Sustainability Report). Some banks also use AI to deliver customized financial literacy content, helping to raise overall financial awareness.

3. Intelligent Risk Control & Compliance: Safeguarding Financial Security

AI excels in fraud monitoring, KYC, and AML. Major Taiwanese banks have deployed AI anti-fraud systems to identify suspicious transactions in real time. In 2024, AI-assisted anti-fraud systems intercepted over NT$10 billion in suspicious transactions, effectively safeguarding financial security (FSC Anti-Fraud Report).

4. Insurtech Innovation: Broader Coverage for All

AI is driving insurance product innovation. Institutions such as CTBC Life have launched AI-powered micro-insurance targeting small businesses and vulnerable groups. AI-based pricing and automated claims processing have greatly improved efficiency, leading to higher insurance penetration (CTBC Life News Center).

With the empowerment of AI and big data, the financial industry has not only improved service efficiency and risk control capabilities but also laid a solid technological foundation for the deepening of financial inclusion. For example, our self-developed COMPASS Financial Data Analytics Platform integrates diverse data sources and combines real-time and historical data analysis, providing financial professionals with intelligent insights and decision support, and helping financial inclusion services reach further and deeper.

Challenges, Trends, and Regional Insights

AI brings new breakthroughs to financial inclusion in Taiwan, but it also comes with challenges such as data privacy, technology adoption, and algorithmic bias. The FSC has issued “Ethical Guidelines for AI in the Financial Industry,” requiring institutions to strengthen data governance, ensure transparency, and prevent algorithmic discrimination.

Looking ahead, with improved regulation, technological advancements, and ongoing collaboration between financial and tech companies, financial inclusion in Taiwan is expected to advance further. Taiwan’s innovative experience also provides valuable insights for Hong Kong, Singapore, and other Asia-Pacific regions, and regional cooperation will jointly drive the intelligent development of financial inclusion.

This is the last article in our "AI-Driven FinTech Transformation" series.

Follow for upcoming analyses on more fintech insight. Stay tuned!. If you found this valuable, please share with colleagues who might benefit!

References

World Bank. (2021). Global Findex Database 2021.
Financial Supervisory Commission, Taiwan. Fintech Development Action Plan.
Yahoo Finance News. “Taiwan Bank Digital Account Openings Up Over 50% in Q1,” 2025-04-25.
LINE Bank. “Record High Account Openings Among Under-30s Exceed 1.8 Million,” 2025-01-03.
SinoPac Holdings. 2023 Sustainability Report.
Financial Supervisory Commission, Taiwan. [News Release, 2024-04-26]
CTBC Life. News Center.