Virtual dispute resolution (VDR) and artificial intelligence (AI) have been progressively utilised in addressing financial disputes. This method has advantages and disadvantages, and it is vital to acknowledge its limitations in the present context.
I. Advantages of employing VDR and AI in resolving financial disputes:
- Effectiveness: Digital conflict resolution can conserve time and resources by simplifying the dispute resolution process. AI can aid in processing extensive data and pinpointing pertinent information more rapidly than human counterparts (Katz, 2017).
- Economical: VDR can decrease expenses related to conventional dispute resolution approaches, such as transportation and lodging costs for participants. Furthermore, AI-driven procedures can reduce the necessity for costly human specialists and legal counsel (Susskind, 2019).
- Availability: VDR can render dispute resolution more accessible to parties in various locations, surmounting geographical obstacles. Likewise, AI can ensure equal access to justice by lessening reliance on high-priced legal assistance (Katz, 2017).
II. Disadvantages of employing VDR and AI in resolving financial disputes:
- Absence of human connection: Some contend that AI and VDR may lack the compassion and comprehension needed for successful dispute resolution. The lack of in-person communication can make it hard to build trust and rapport among the parties (Ebner & Zeleznikow, 2016).
- Data protection and security issues: VDR necessitates using digital platforms, which raises concerns about data privacy and protection, specifically in personal financial disputes (PVDRC, 2018).
- Restricted competence: Although AI has made considerable progress, it still possesses limitations, particularly in grasping complex human emotions and subtle legal notions. This may occasionally result in poor or erroneous outcomes (Susskind, 2019).
III. Limitations of VDR and AI in resolving financial disputes:
- Technological hurdles: The efficacy of VDR and AI-driven dispute resolution hinges on the accessibility and complexity of technology, which can pose a barrier for some users, especially in underdeveloped regions (Katz, 2017).
- Legal and moral dilemmas: The deployment of AI in dispute resolution elicits numerous legal and ethical issues, such as responsibility, openness, and impartiality. The existing legal framework may require complete adaptation to tackle these matters (Susskind, 2019).
- Opposition to implementation: Conventional legal professionals and institutions might need more time to embrace VDR and AI-driven processes due to apprehensions about job loss and an assumed menace to the legal sector (Katz, 2017).
In summary, VDR and AI offer considerable prospects for enhancing the resolution of financial disputes. Nevertheless, their adoption presents challenges and constraints. As technology progresses, it will be essential to address these issues to guarantee that VDR and AI-driven dispute resolution techniques reach their maximum potential.