In the Artificial Intelligence Bulletin – Fintech & The Future of Banking we examine how A.I. is expected to lead to changes in two of the world’s biggest financial markets: the U.S. and the U.K.
The first article we look at analyzes the state of play in the United States and what type of functionality the top 7 U.S. banks are trying to build using machine learning algorithms.
It also shows what type of dollar amounts these banks are investing… Clue: it’s a lot!
Next, we jump across the pond, and find out how A.I. is infiltrating the U.K. banking scene.
AI in Banking – An Analysis of America’s 7 Top Banks
This article from Tech Emergence is interesting as it looks at what America’s top 7 biggest banks are doing to implement artificial intelligence into their core business.
Artificial intelligence is going to be transformative for banking, much as it will be for many other industries.
What this means is AI will not just lead to increased productivity or existing business processes becoming more efficient (although this is most definitely true!).
No. It means that entire workflows, jobs, tasks, and processes themselves will have to be examined to such an extent that some will no longer exist, and some will have to be completely redefined.
A.I. will transform the banking industry in a similar respect to when computers first arrived on the scene.
In that case, it was calculations and computation that become easier and cheaper.
For AI, it will be predictions and predictive technology that will become ubiquitous.
The top 7 US banks: JP Morgan Chase, Wells Fargo, Bank of America, Citibank, U.S. Bank, PNC, and Bank of NY Mellon Corp. are already undergoing huge changes in preparation of taking advantage of the AI revolution.
Many have created important innovation and AI departments in order to allocate and invest huge resources (in the billions of $) into programs and machine learning algorithms.
These programs are being led by the brightest and best managerial staff.
The banks are building functionality to help their customers invest and build wealth more easily while protecting them from fraud and cyber theft.
Here’s a list of program functionality being built by the banks with virtual agents/chatbots leading the way with 37% responding they are currently building this.
For example, meet Erica, Bank of America’s virtual assistant being rolled out to its 25 million mobile customers in this video:
Read more about each bank’s specific measures and levels of investment at Tech Emergence
How UK Banks are Looking to Use AI and Machine Learning
Across the pond, AI is making similar in-roads into the banking system.
The big growth areas according to this Computer World UK article are:
- Algorithmic Trading
- AI-Managed Funds
- Anti-Money Laundering
- Real Time Transaction Analysis
- Personalized Recommendations
- Credit Applications
- Investment Research
Much like the US banks, the main areas of focus for A.I. could be summarized as cyber-security, customer service tools, and investment.
In terms of hedge funds, it’s interesting to compare how A.I.s perform versus human managers.
It would be safe to assume that in time, artificial intelligence will manage investment funds better than humans due to their ability to process large amounts of data and variables.
“By 2015 artificial intelligence was contributing roughly half the profits in one of Man’s biggest funds, the AHL Dimension Programme that now manages $5.1 billion, even though AI had control over only a small proportion of overall assets.”
How A.I. will impact on jobs in banking is a huge consideration.
Artificial intelligence will change the nature of existing jobs and eradicate some of them.
Read more at Computer World UK
The Future of Finance & AI Keynote by Nikolas Badminton
Keynote from October 22nd, 2016 at Real Machine Summit in Las Vegas on how artificial intelligence in the finance industry will change everything.
Artificial Intelligence Panel – IBM, Wells Fargo, Feedzai
In Spring 2017, Feedzai, a leading data science company shaping the future of fraud detection in commerce, and BayPay Forum, a leading business and event network for payment, commerce and Fintech executives, hosted an engaging evening at Wells Fargo to discuss the real world application of AI across payments and banking.
Futurist Speaker Nikolas Badminton hosted the discussion and was joined by:
- Eric Greene, Lead AI engineer at Wells Fargo
- Petros Zerfos,Research Staff Member & Manager at IBM Research
- Pedro Bizarro, Chief Science Officer at Feedzai
Nikolas is a world-leading Futurist Speaker that drives leaders to take action in creating a better world for humanity. He promotes exponential thinking along with a critical, honest, and optimistic view that empowers you with knowledge to plan for today, tomorrow, and for the future.
Read previous bulletins and posts from Nikolas Badminton: