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AI is skyrocketing (again) while the panic is all around in the Financial Services Industry God knows what the next economic storm is going to be; along with the rise of digital banking, and the increasing complexity of financial transactions, the banks are struggling to keep up with the pace so it won’t go belly up. The question in thought leaders' minds is, can AI proactively rescue and manage the banks to avoid it?
The good news is that artificial intelligence (AI) has the potential to revolutionize the way banks operate and serve their customers. By harnessing the power of AI, banks can transform their operations, streamline their processes, and offer new products and services tailored to their customers' needs.
Let's see how AI can help rescue banks from the challenges they face and propel them into the future.
Prediction goes hand in hand with risk management – the power of AI
As we all know, banks face various risks, from credit risk to market risk to operational risk, while innovating with multiple partners. Utilizing the power of AI algorithms:
Great…I understand AI has the potential to significantly improve the risk management practices of banks and help prevent bank failures.
BUT..what about the ethical implications of using AI?
... especially in areas such as lending and risk management? According to KPMG US, 73% of their respondents reported that a degree of regulatory oversight of predictive models is required, which is constrained by skilled resources, budgets, and tools. Most expect auditors to go after these models within the next 1-4 years. While using AI, banks can focus on three major areas:
Now that the bank knows what to check if they can address these concerns, AI can potentially transform the banking industry for the better. AI can rescue banks from the challenges to create a more efficient, effective, and customer-focused financial services industry that benefits everyone.
This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.
Eimear Oconnor COO at Form3 Financial Cloud
07 November
Kyrylo Reitor Chief Marketing Officer at International Fintech Business
06 November
Konstantin Rabin Head of Marketing at Kontomatik
Alexander Boehm Chief Executive Officer at PayRate42
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