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Fintech Q4 2023

Financial services adapting to the ‘mainstreaming’ of AI

iStock / Getty Images Plus / metamorworks

Dr Nicola Stokes

Chief Technologist for International Financial Services, IDA Ireland

While R&D and digital transformation in the industry have been enabled by various emerging technologies, the focus has firmly been on artificial intelligence (AI) this year.

Research and development (R&D) activity is thriving in Ireland’s International Financial Services (IFS) sector with many of the world’s most esteemed brands building out significant AI capabilities here.

Spread of AI in financial services

In recent years, the democratisation of AI services — through a combination of cloud and open-source software — has shown promise in terms of increasing operational efficiency, improving customer engagement and developing new products and business models. However, the launch of OpenAI’s ChatGPT demo at the end of last year marked a turning point for the IFS sector in terms of widespread AI deployment.

Productivity and economic gains

ChatGPT uses generative AI (GenAI), an AI technique that can produce high-quality content, such as text, audio, images, video and code. Like other AI techniques, it promises to take the ‘robot out of the human,’ freeing up time for more high-value work. According to OpenAI, 92% of Fortune 500 companies are now using its technology.

A recent study from MIT showed that GenAI increased productivity by 37% across college-educated professionals while Goldman Sachs believes it could raise global GDP by at least 7% in the next decade.

In the near future, we will see widespread
deployment of GenAI across our
everyday business applications.

Revolutionising workplace software and client services

In the near future, we will see widespread deployment of GenAI across our everyday business applications such as video conferencing, email and word processing. GenAI will automatically prepare speeches and slide decks for us, generate graphs from data, organise our diaries, reply to emails and attend meetings on our behalf.

However, IDA Ireland’s IFS clients are also building bespoke in-house GenAI solutions trained on their own data. Promising areas of exploration include the transformation of client services through hyper-personalisation of content, auto-generation of RFP responses, bespoke marketing and sales material and robo-assisted client onboarding.

Challenges of deploying AI

Deploying AI and GenAI at scale does not come without its challenges, though. These include digital transformation as a prerequisite for AI deployment, impending AI regulation and the evolution of job roles prompted by strong productivity gains.

We are, therefore, seeing companies doubling down not only on AI R&D, governance, risk and compliance but also on learning and development activities that will build a workforce that is AI literate and capable of synergising with machines. IDA Ireland is working with clients to help drive these strategic conversations and tailor our range of support to their bespoke transformation needs.

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