AI Could Destroy Traditional Banking As We Know It

AI Could Destroy Traditional Banking As We Know It

Article from: The Financial Brand

Mid-size and small banks and credit unions could soon find themselves at a serious competitive disadvantage. Ongoing developments in artificial intelligence have the potential to significantly change the way back offices operate and the experiences consumers receive from financial institutions. More importantly, these new technologies could disrupt how banks and credit unions attract and retain their customers, create new business models and present regulatory issues, according to the report, “The New Physics of Financial Services” from the World Economic Forum and Deloitte.

There is little doubt that AI can provide significant benefits for the banking industry, as has been documented often in The Financial Brand. However, the 166-page analysis finds that the significant efficiencies that AI provides through the use of data could provide the largest financial services organizations and tech companies with unmatched competitive advantages at the expense of mid-sized and small banks and credit unions. A bigger concern could be that the industry is not prepared to respond, concludes the report.

  

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