DIGITAL BANKING
“ IBM is successfully using Gen AI to reverse engineer and modernise these legacy platforms ,” he says .
“ For a building society in the UK , we are modernising the core mortgage platform . Gen AI is helping our software developers by reading the code of the mortgage platform and generating business logic , translating the code to modern languages and testing the application .”
This application of AI in modernising legacy systems represents a significant opportunity for banks to update their technology infrastructure more efficiently and cost-effectively .
Prashant notes that , in many cases , this can “ reduce the time and cost of modernising legacy platforms by more than 50 %, thus improving the ROI on such programmes ”.
While the potential benefits of AI in banking are significant , experts caution that its adoption comes with challenges .
“ AI promises enormous benefits and much positive change but that won ’ t happen if those who are supposed to benefit from the technology don ’ t trust it ,” Viren warns .
This issue of trust is particularly crucial in the financial services sector , where banks are the custodians of sensitive customer information .
Viren cites a 2024 Workday report which found that only 52 % of workers trust AI will be deployed responsibly .
Prashant echoes this sentiment , highlighting the need for strong governance in AI adoption .
“ Gen AI can model rare scenarios for testing , helping banks better prepare for risks and opportunities ”
He says : “ Strong governance is central to building trusted AI , especially in financial services . It ’ s crucially important to understand what AI models the organisation has , the data the organisation tunes and applies those models to , the models ’ intended uses and their compliance with regulations .
“ At least five countries have AI regulations and two-thirds of the world ’ s countries have privacy and data governance laws .”
The future of AI in banking As AI continues to transform the financial services industry , our experts agree that its impact will be far-reaching .
From enhancing customer service and improving fraud detection to streamlining regulatory compliance and boosting operational efficiency , AI is set to revolutionise every aspect of banking .
Ryan predicts that AI will facilitate more advanced Open Banking ecosystems , “ allowing data to be shared between banks and third-party providers . This should add
76 December 2024