AI in Finance: The Road Ahead
“The most important general-purpose technology of our era is artificial intelligence, particularly machine learning (ML) — that is, the machine’s ability to keep improving its performance without humans having to explain exactly how to accomplish all the tasks it’s given. Within just the past few years machine learning has become far more effective and widely available. We can now build systems that learn how to perform tasks on their own.”
Erik Brynjolfsson and Andrew McAfee - The Business of Artificial Intelligence
Harvard Business Review
- Artificial intelligence is reshaping how we work, interact and share information and content. AI technologies are increasingly being incorporated into many of our daily activities. AI opportunities in financial services are broad-based addressing needs in risk assessment, financial analysis, portfolio management, credit approval process, know your client (KYC) & anti-money laundering (AML) systems, various operational and customer interaction processes and system/data security.
- AI can present a threat to incumbent financial firms as well as create opportunities. A competitive challenge is that technology firms (Alibaba, Amazon, Apple, Baidu, Facebook, Google, IBM, Microsoft, Tencent and others) could expand their reach into financial services by leveraging their global presence, technical expertise, innovative platforms, customer data sets and brand loyalty.
- Momentum for AI will continue to build as data becomes more available, algorithms improve, developer skill sets broaden and computing power accelerates. However, concerns about AI include limited transparency about how systems work, bias in application logic, data quality and negative impact to employment.
Our report includes: 1) AI use cases in finance, 2) perspectives from market participants and 3) survey results with business decision makers.
The informational videos (accessible from page 5 of the paper) should also be of interest.
- “The Master Algorithm: How the Quest for the Ultimate Learning Machine Will Remake Our World” by Pedro Domingos
- “The State of Artificial Intelligence” - Andrew Ng
- “The Future of Finance” Milken Institute – Global Conference 2018