Great opportunities – and some hazards - await AI’s role in financial services

Artificial intelligence is expected to revolutionise the financial services industry with an unprecedented depth and breadth of insight and the ability to act on information and learn from its actions. However, many executives acknowledge a degree of risk surrounding the use of AI, according to a research from global law firm Baker & McKenzie.

Trading, financial analysis and IT are expected to be changed the most over the next three years according to respondents, but the impact is expected to be wide ranging with machine learning to affect risk assessment, credit assessment and portfolio management

"Almost 50% of senior financial services professionals are not confident their organisation understands all the legal risks or other risks associated with AI. "
Darren Sibson & Francesca Rizzo, BlueNotes contributing editors

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Survey respondents were clear that machine learning will have a positive impact on competitiveness in financial markets yet believe the most negative effects of AI will be in the makeup of the work force and market stability.

Like with all technology, the introduction of AI in financial services will largely depend on how it is employed that will ultimately determine the risk and reward. It also raises important questions and concerns about the liability of a functioning AI platform. Does the responsibility lie with coders who develop the software, the company who is using it or the data provider?

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Nevertheless, experts and executives acknowledge a degree of risk surrounding the use of AI with concerns surrounding the security, privacy and quality of data leading to calls for new regulation.

There is still much to learn about how transformative machine learning will be, and much to learn about its potential downsides. Read the full report here and watch the video below.

Darren Sibson and Francesca Rizzo are contributing editors and work in Digital and Social Media at ANZ

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

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