Dive Brief:
- Banks are balancing ongoing spending on cloud and cybersecurity technologies against an eagerness to invest in AI, according to a Broadridge survey of 500 financial services C-suite and senior executives in 18 countries published Tuesday.
- The vast majority of respondents are prioritizing data management, cybersecurity and cloud platforms in day-to-day investments. They also intend to maintain or increase spend on emerging technologies, including generative AI, quantum computing and blockchain over the next two years.
- Digital transformation has helped lay the groundwork for AI adoption in banking, which is poised to benefit from the technology more than any other industry, according to Accenture. More than two thirds of Broadridge respondents said they’ve made meaningful progress in modernizing their core IT platform.
Dive Insight:
Cloud providers inundated enterprises with a steady stream of model options last year, and the tap has yet to run dry. Nvidia unveiled a portfolio of dozens of enterprise-grade, cloud-based microservices this month aimed at helping companies tune models with proprietary data.
But transformational solutions require a clean data estate, a robust tech stack and heightened security measures.
“With pre-trained models, companies are finding that it is possible to make compelling progress on previously stalled use cases and pilots,” Joseph Lo, head of enterprise platforms at Broadridge, said in an email. “However, it is also clear that companies that have made big moves with generative AI have differentiated themselves with the data that is proprietary to them.”
Investments in operationalizing generative AI cut across the business, from front-office customer service functions and document summarization capabilities, to beefing up data management systems, the survey found.
“Most companies don’t have any shortage of data,” Lo said. “But the sophistication of being able to access it at the velocity that is required to hydrate these models and the use cases they enable has been the challenge.”
Security is a problem, too.
Cyber concerns continue to stall digital transformation, prompting financial firms to boost investment in this area by an average of 28% in the next two years. Security was also the top capability executives expect from third-party vendors, the survey found.
“Data readiness — the ability to access proprietary, clean data at sufficient velocity with the right levels of security, is table stakes,” Lo said. “Companies must ensure they have robust AI governance policies and controls, inclusive of cyber resilience, privacy, and data security, in place.”
