The rapid spreading of generative artificial intelligence is having a measurable impact on the financial services sector across Canada and far beyond.
But the technology itself appears to be spreading faster than many banks can keep up with; nearly 90% of financial services firms still lack a comprehensive, enterprise-wide AI strategy, according to a new study from digital services and consulting Infosys.
Titled “Why, What, and How Financial Services firms can be AI-First,” the report from Infosys and HFS Research highlights a need for many financial firms to adopt a “cohesive, global enterprise-wide AI strategy” which “ensures that AI investments directly contribute to revenue growth, cost optimization, and enhanced stakeholder value.”
The top AI objective for two-thirds of banking and financial services enterprises is to boost bottom-line productivity, Infosys’ data suggests. But are they going about to the right way?
Banks are investing heavily in AI, the report acknowledges—AI budgets are expected to increase 25% this year, commanding 16% of total tech budgets—but seldom in “strategically meaningful ways.”
Without “strategic alignment” of AI in the broader business strategy, efforts wind up fragmented across individual business lines and geographic silos, the report posits.
To maximize enterprise-wide value, a top-down framework with clear guidance from C-suite leadership, combined with bottom-up execution driven by domain experts within each business function, is deemed essential by the report.
Such an integrated approach capitalizes on the AI opportunity via a deployment method that advances the enterprise’s strategic priorities.
“While many foundational needs are being addressed in the current funding and investment cycle, BFS leaders must also consider AI governance and AI talent to enable true scale,” commented Phil Fersht, who serves as Chief Executive Officer of HFS Research. “AI governance needs to be defined as part of enterprise-wide AI strategy and supported across functions.”
While the road ahead may be directionally obvious for fintechs, obstacles to successful AI adoption remain. The report spotlights data quality and access, security and privacy, and skilled talent as the three biggest roadblocks.
“To unlock the full potential of AI, leadership teams must remove roadblocks through strong AI governance practices,” believes Dennis Gada, who serves Infosys as Global Head of Banking and Financial Services.
“The path to being AI-First is paved with various challenges,” admits Fersht.
Still, the effort is worth the reward, according to Gaia.
“The future of work is AI-first,” he said.
Leave a Reply