According to an IDC report, banks spending additional 31 billion dollars on AI to reduce fraud by 2025. Banks are also implementing AI in middle-office tasks to analyse risks, identify and prevent payment fraud, enhance anti-money laundering (AML) processes, and undertake know-your-customer (KYC) regulatory checks.
According to the research, fraud control is a top issue for bank executives. To combat fraud, banks globally are estimated to invest an extra $31 billion in artificial intelligence (AI) incorporated in current systems by 2025. Let’s check the details here.
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Banks Spending Additional 31 Billion Dollars On AI
The IDC research noted that fraud management is a top issue for banking executives all across the world. Businesses may underestimate the effectiveness of their present defensive systems against fraud when they develop digital goods and services, new distribution channels, and new payment options, according to Michael Araneta, Associate Vice President, IDC Financial Insights.
“What worked previously would simply not suffice in today’s more digital corporate world. The capability of fraud management must be constantly upgraded “Araneta emphasised. The banking industry is caught between two crisis scenarios, each of which necessitates responses that may contradict one another.
“Government policy must be flexible, and financial services organisations — banks, insurers, and capital market corporations — must strike a balance between income generation and risk management,” Araneta explained. By 2023, the sector will also be engaged in platform development, allowing financial services to be externalised and offered to third parties.
“The sector is developing fresh partnerships including digital lifestyle ecosystems and banking as a service (BaaS). Being digital-first implies being aware of the special time in the recovery of financial services, which is quite apparent “Added Araneta.
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