Financial Services are Banking on AI Implementation

A recent KPMG study says AI will play a crucial role in fraud prevention and consumer experience

Financial services are banking heavily on AI implementation in terms of preventing and detecting fraud along with improving customer experience, according to a recent report from KPMG​.

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The study titled “Living in an AI World 2020: Achievements and Challenges of AI across Five Industries” mentions only 42% of respondents considered AI to be more hype than realistic; this constituted the lowest percentage of any industry surveyed. Other industries included in the survey along with finance are healthcare, retail, transportation, and technology. At present, nearly half (47%) of respondents said organizations are functional in AI deployment. The nature of big financial services businesses makes rapid AI deployment rigorously challenging, found the report. The report suggests CFOs must invest aggressively in AI technology, training, and governance, to ensure they have the capabilities to thrive as the financial industry evolution continues.

The study states that not all respondents are equally excited about the possibility of AI becoming mainstream. Interestingly, 72% of respondents worried that AI could pose a security threat, while 69% see it as a direct consumer data security and privacy threat. As per the KPMG study, the top three most impactful uses of AI will be in robotic process automation (RPA) (56%), risk management assessments (49%), and fraud prevention (47%) over the next three years. Fraud prevention AI will prove crucial in protecting an organization’s bottom line, as one major breach could threaten its existence. Leaders should ensure that AI models align with their company’s quality and security standards, as well as with corporate values. The study recommends that companies need to implement AI strategically in line with their business strategies.

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The KPMG study further mentions that the talent gap is a hurdle cited by respondents to timely AI deployment. Only 49% of respondents believe their employees are prepared for wide-scale AI adoption. Also, 23% of those employees would be enthusiastic about AI adoption at all. If organizations neglect to invest in AI or non-aggressive adoption, they will fall behind. AI will continue to become a more significant part of daily life, both for businesses and consumers, found the study.

The bottom line is that companies must look at AI as more than just a technology. The report concludes saying that AI implementation should be an integral part of a business strategy as it will allow enterprises to realize the real benefits and gain competitive advantage.