The future, or a fad? Shameek Kundu, Head of Financial Services at TruEra and an expert on CFTE’s AI in Finance Course, looks at whether AI’s credibility gap could hold back the banking industry.
Artificial Intelligence (AI) is widely seen as key to the banking industry’s transformation. Industry surveys, including one from the Bank of England, suggest that two in every three financial institutions have adopted AI in some form. In most banks, neither the 2020 budget restrictions nor the failure of some AI systems during COVID-19 appear to have slowed down AI-related recruitment or technology spending.
But is the reality of AI adoption in banking living up to the hype? Are banks genuinely transforming themselves using AI? Talk to bank data science teams, and a nuanced story emerges. AI has graduated from its ‘shiny new toy’ status into real-life use cases. However, most claims of new AI-enabled business models are exaggerated, either in their ‘newness’ or in the role that AI plays in enabling them. In most banks, AI adoption has led to modest improvements in efficiency and risk management, but has not yet been transformational in any meaningful sense.
About The Contributing Author:
Shameek Kundu, Head Of Financial Services and Chief Strategy Officer at Truera, Former Group Chief Data Officer at Standard Chartered, and expert at CFTE. Shameek heads the Financial Services vertical at Truera, a startup dedicated to building trust in Artificial Intelligence. He also sits on Responsible AI public/ private groups at the Bank of England/ FCA, the OECD Global Partnership on AI and the Monetary Authority of Singapore. Until the end of 2020, he was Group Chief Data Officer at Standard Chartered, having played that role since 2014. He has also been CIO of Enterprise Functions (managing a $500m, 2500 person team) and Head of Innovation at the bank. On top of it all, he is truly passionate about all things data.