A QUESTION OF TRUST
“ TECHNOLOGY CAN HELP BOTH BANKS AND REGULATORS MANAGE RISK IN THE SECTOR MORE EFFECTIVELY , WHILE ON THE OTHER HAND NEW CHALLENGES ARE INTRODUCED TO THE SYSTEM ”
A QUESTION OF TRUST
As explained by Bottomley , however , greater use of data and AI increases risk in several ways . “ At its heart , banking is based on trust ,” he explains . “ While customers often want banking services to be modern and responsive , they also want to be certain that their money and their information are safe .” This , he explained , relies on banks making ‘ informed and appropriate ’ decisions , while demonstrating how they propose to use such technologies in an ethical manner that is consented to by regulators and investors .
To this end , balancing risk mitigation and technology will be crucial for banks to succeed . Robust ethical frameworks will be essential , for example , as will controls for protecting customers in order to maintain trust levels and the integrity of the wider financial services market . To achieve this , HSBC proposes financial services regulators , governments , banks and other industry bodies work closely in order to evolve from national regulatory practices to a singular global regulation that considers how to best adopt and work with new technologies available . In particular , says the report , “ developments in areas like big data , cloud and AI will need more and more international cooperation ” with banks , ensuring that they are ‘ global ’ in their outlook to facilitate this .
It adds : “ Technology will require better regulation ; regulation will require better technology . But within this cycle , a responsible and more intelligent global banking ecosystem can thrive .” If , for example , work is undertaken
35 www . fintechmagazine . com