Generative AI, like that offered by OpenAI and its ubiquitous ChatGPT tool, has taken the world by storm over the last year or so. But is the technology mature enough for use by the banking sector in Australia and New Zealand?
Generative artificial intelligence, or GenAI, is one of the most talked-about topics of recent times. It is fast evolving, easily accessible, and promises businesses increased efficiency and productivity.
But is this consumer-level technology ready for enterprise-level implementation by banking organisations across Australia and New Zealand? The latest research from Simplus sheds light on how financial organisations in the region are embracing GenAI.
How banks can use Generative AI
As well as the ever-growing set of use cases that would tempt all businesses – accelerated sales cycles, optimised marketing campaigns, improved customer experiences – GenAI offers further capabilities that are particularly attractive to the banking sector.
- For many banks, implementing new tech is a strategic focus for the coming year, and GenAI stands ready to help. Its ability to rapidly prototype software will catch the eye of many engineers, for example.
- Access to richer data, plus the power to quickly analyse and share results, means faster and better data-driven decision making is possible.
- AI-powered solutions can help reduce the risk of fraud, hacking attacks, or data theft, and reduce the time to action for responses for any breaches of security if they do happen.
- Three quarters of banking leaders surveyed by Simplus said that enhanced regulatory compliance was a major benefit of enterprise-wide implementation of GenAI technology.
Generative artificial intelligence, or GenAI, is one of the most talked-about topics of recent times. It is fast evolving, easily accessible, and promises businesses increased efficiency and productivity.
But is this consumer-level technology ready for enterprise-level implementation by banking organisations across Australia and New Zealand? The latest research from Simplus sheds light on how financial organisations in the region are embracing GenAI.
Have banks started adopting GenAI already?
The banking landscape is changing. Open Banking, cryptocurrency, and an increased focus on usability and customer experience mean that more traditional institutions have had some catching up to do as they counter the digital-first activities of more nimble start-ups.
But one surprising aspect of the Simplus research into GenAI adoption among banks in Australia and New Zealand is that the larger institutions – those with assets above $10b – are further along the road when it comes to enterprise-wide adoption of generative artificial intelligence.
In fact, nearly four in five banks across the region have moved beyond the infancy stage of GenAI adoption. Of those, nearly a quarter have already reached a mature implementation, where the technology is fully embedded across the organisation.
What are the challenges when implementing GenAI?
Enterprise-wide implementation of any new technology is not without its challenges. It’s no different for GenAI, with nearly two-thirds of banking leaders agreeing that deploying enterprise-wide AI at their institutions has been at least somewhat challenging.
There’s no single barrier to adoption that stands out, though. Concerns around data security top the list, as reported in our Generative AI in Banking: A Progress Report, but the list of obstacles includes a lack of governance, a shortage of talent, and a heavy reliance on legacy technology – referred to as technical debt.
A key barrier to the successful adoption of any AI technology is data. The accuracy and reliability of data models is the most pressing concern for most banking leaders in Australia and New Zealand – a problem that can only be solved by a trusted, robust single source of truth.
Generative AI in Banking: A Progress Report
Our latest research – Generative AI in Banking: A Progress Report – contains deeper insights into the state of GenAI for banking in Australia and New Zealand.
As well as more information on the benefits of GenAI and the challenges of implementation, the report also includes:
- Critical success factors for the effective deployment of GenAI
- A breakdown of the potential risks arising from adoption of GenAI
- Insights from banking leaders who are already on their implementation journey
