The AI imperative: The future of frictionless banking

in partnership with

Amazon Web Services

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Digital Reinvention
12/03/2024 Study
Digital Reinvention
15 Nov 2023
15/11/2023 Coffee

Banking transformed: AI/ML and GenAI revolution

Artificial intelligence and machine learning (AI/ML) are nothing new in financial services—banks have been using these technologies to some extent for over a decade. But what is new is the abundance of data we have at our fingertips, the advancement of computing power, and the broad availability of large language models (LLMs).

All this means these technologies have the potential to transform banking. In fact, AI and analytics could add $1 trillion to the industry annually. 

This impact will be impossible to ignore. That’s why, in collaboration with Qorus, Amazon Web Services (AWS) has conducted a research project exploring the transformative potential of AI/ML and generative AI in financial services. 

“Just a few years ago, we spoke about being in the fourth industrial revolution. At that point, I don’t think we quite realized what the fourth industrial revolution would look like. But then generative AI came along. This technology is truly transformative and extremely fast, deep and broad in its development. It will impact everything we do. There’s no doubt about it, in five years, we will be working and living differently.”

Roberto Ferrari, Digital Reinvention Community Leader, Qorus

The results of the research show that we are at a pivot point in terms of AI/ML adoption, with the majority (81 percent) of respondents planning to adopt it to improve customer service in the next 12-18 months. Over half (56 percent) say they will use the technologies for risk management improvement, followed by back-office optimization (49 percent), automated compliance and regulatory reporting (28 percent), and developer productivity (25 percent). 

Clearly, there are huge opportunities around AI/ML. While several impediments (such as data infrastructure, regulations, and explainability) will need to be addressed along the way, those banks that successfully embed these technologies across their value chain stand to reap the rewards. 

Our insights are derived from a survey of over 100 senior banking executives and in-depth interviews with established industry leaders. These executives shared their experiences, challenges, and visions for the future, offering a well-rounded perspective on the current state and future potential of AI/ML in banking. In addition, AWS thought leaders, recognizing the need for banks to experiment and invest, as well as the impediments to doing so, share insights to help banks pave a roadmap for the future. They provide insights on what to consider when implementing generative AI, and how to find the right balance between innovation and compliance.

Ready to explore the future of banking powered by AI?

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