23 June 2018
Visit www.gemalto.com

Capital markets jobs on the line as banks raise AI spend

07 March 2017  |  18858 views  |  0 Robo advisor

Up to 230,000 employees in capital markets are set to be replaced by artificial intelligence agents over the next eight years, according to research by consultancy Opimas.

The consultancy estimates a 28% improvement in financial institutions’ cost-to-income ratio by 2025 as they automate routine processes currently performed by employees.

In terms of job losses, the asset management industry will shrink most, with around 90,000 people being replaced by machines. The firm estimates that a third of the jobs lost to machines will be replaced by technology and data providers serving the industry’s new needs, creating close to 30,000 new jobs at technology and data providers.

The uptick in spending on AI-related technologies - including robotic process automation, machine learning, and cognitive analytics - is already evident, with $1.5 billion expected to be allocated across the banking industry over the next year, rising 75% to $2.8 billion by 2021.

Bank investment in the technology is likely to reinforce current power structures, believes Opimas, creating a formidable barrier to entry for new startups.

"Since they need access to vast amounts of data to efficiently train an AI system, banks have a clear advantage over potential new entrants because they can leverage their huge internal data sets," says the report. "Once financial firms revamp their business operations using AI technologies, they will raise the barriers to entry in their market so high that it will be nearly impossible for newcomers to compete."

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Millions of jobs at risk in Fourth Industrial Revolution - BofE staff blog

Millions of jobs at risk in Fourth Industrial Revolution - BofE staff blog

01 March 2017  |  8657 views  |  2 comments | 18 tweets | 16 linkedin
Robot workers to monitor markets for abusive trading

Robot workers to monitor markets for abusive trading

28 February 2017  |  7525 views  |  0 comments | 16 tweets | 17 linkedin
BNP Paribas takes stake in AI-based compliance startup

BNP Paribas takes stake in AI-based compliance startup

30 January 2017  |  11513 views  |  0 comments | 16 tweets | 16 linkedin
RBC hires AI pioneer as advisor to new machine learning lab

RBC hires AI pioneer as advisor to new machine learning lab

19 January 2017  |  8330 views  |  0 comments | 10 tweets | 9 linkedin
Accenture and Blue Prism sign bank to robotic process automation software

Accenture and Blue Prism sign bank to robotic process automation software

05 January 2017  |  14821 views  |  0 comments | 6 tweets | 17 linkedin
Japanese insurer to replace 30% of workers with AI

Japanese insurer to replace 30% of workers with AI

04 January 2017  |  6816 views  |  1 comments | 14 tweets | 9 linkedin
Nordea looking for AI and blockchain breakthroughs

Nordea looking for AI and blockchain breakthroughs

22 August 2016  |  12646 views  |  0 comments | 18 tweets | 21 linkedin
Deutsche Bank crowdstorms AI ideas

Deutsche Bank crowdstorms AI ideas

09 May 2016  |  14264 views  |  0 comments | 27 tweets | 17 linkedin
Tech revolution to wipe out 7.1 million jobs over next five years - WEF

Tech revolution to wipe out 7.1 million jobs over next five years - WEF

18 January 2016  |  8174 views  |  2 comments | 18 tweets | 15 linkedin

Related blogs

Create a blog about this story (membership required)
Visit www.aciworldwide.comVisit www.worldwealthreport.comVisit equensworldline.com

Top topics

Most viewed Most shared
GPS raises £44 million to fund international growthGPS raises £44 million to fund intern...
26183 views comments | 7 tweets | 8 linkedin
Robots save Nordea from GDPR processing nightmareRobots save Nordea from GDPR processing ni...
9070 views comments | 10 tweets | 17 linkedin
BIS: Cryptocurrencies are an environmental disaster that could break the InternetBIS: Cryptocurrencies are an environmental...
8370 views comments | 18 tweets | 23 linkedin
hands typing furiouslyArtificial Intelligence at the changing fa...
7215 views 0 | 10 tweets | 5 linkedin
Visa says 5.2m payments failed during 10 hour outageVisa says 5.2m payments failed during 10 h...
6246 views comments | 14 tweets | 10 linkedin

Featured job

Basic c Euro 120K, Variable Euro 120K - full ben...
Paris prefered London possible

Find your next job