Unlocking The AI Growth Multiplier
For companies across industries, AI can
be a powerful growth tool by unlocking insights,
capabilities, and productivity. For financial
services, it could go even further by transforming
how institutions and individuals interact with their
financial services providers.
AI’s contribution to the global economy is
currently estimated to be $19.9 trillion through
2030, driving 3.5% of global GDP. Many practical uses of AI are already embedded in industries like
financial services, with the technology beginning
to transform the way products and services are
offered, opening the door to innovation, new
operating models, and inspiring how
organizations reimagine growth.
Advancements in AI have enabled
financial institutions to leverage large datasets to
generate market insights, use generative AI to
help improve decision-making and enhance client
experience, and harness machine learning and
natural language processing to automate. AI is
also being used to develop sophisticated trading
algorithms, detect fraud and cyber threats, and
enhance personalized financial planning.
AI can increase productivity by 40%
through automation of repetitive tasks and
optimization of workflows, enabling businesses to
achieve more in less time and reallocate time
saved to more strategic work. Organizations aim
to evolve from utilizing AI for basic automation to
autonomous operations, focusing on increasing
operating leverage through AI-driven processes
with appropriate controls and human oversight.
This could help streamline operations, enhance
efficiencies, and improve risk management and
compliance, helping to scale operations and
minimize proportional cost increases.
AI can also be an important tool for
mitigating certain types of risks, as it can help
detect anomalies and fraud by continuously
monitoring transactions and identifying
suspicious activities. AI-enabled scenario
creation, analysis, and anomaly detection can
help supercharge risk management and control
mitigation processes.
The next phase of AI for financial
institutions involves creating new value streams
through AI capabilities, preparing for the evolution
of financial market infrastructure, and helping
other market participants and clients through their
transformation journeys. Companies can share
best practices for responsible AI, partner with AI
companies for continued innovation, and find
ways to facilitate interaction between humans
and AI.
While AI can clearly be a growth multiplier,
it is imperative to prioritize the responsible
development and usage of this technology given
the potential risks. Appropriate use of AI within
the financial sector relies on comprehensive risk
management, governance checks and balances
at multiple stages of development, maintaining
human involvement through validation, continuous education, and collaborative
discourse.
The responsible and ethical use of AI is
not solely achieved through technical safeguards,
governance, advanced models, and knowledge
sharing, but also through democratization.
Organizations must empower their workforce with
knowledge and tools to thrive in an AI-driven
world. Providing opportunities for upskilling and
encouraging collaboration can help employees
harness AI responsibly.
Michael Demissie, Christopher Martin and Saed
Shonnar. Unlocking The AI Growth Multiplier.
Available at:
https://www.bny.com/corporate/global/en/insight
s/unlocking-the-ai-growth-multiplier.html.
Retrieved on: January 28, 2025. Adapted.