Beware financiers: AI targets banking before any other job, warns Citigroup

Beware of Financiers: AI Targets Banking Before Any Other Job, Warns Citigroup

Bad news for the one percent: According to a new comprehensive report de Citigroup, finance is poised to bear the brunt of AI-related displacement. AI will “profoundly change money,” the 124-page report declares in its introductory paragraph. Certainly, it creates “new opportunities for growth and innovation, often improving our overall quality of life”, but it also “destroys” and creates many “losers”.

The impact of AI on banking jobs

According to Citigroup, nearly seven in ten banking jobs (67%) have “high potential” to be changed or even entirely outsourced by AI. This figure is based on data from Accenture and the World Economic Forum. This is the highest share of all jobs studied. Industries that follow closely include insurance, software and capital markets.

Traditional adoption of AI in financial services

Shameek Kundu, chief strategy officer and head of financial services at TruEra, wrote in the report that traditional adoption of AI in financial services is “widespread, superficial and inconsequential.”

The potential benefits of AI for banks

The good news is that the implementation of AI could greatly benefit banks and financial institutions. It might not even hurt the overall number of employees, once the hiring needed for AI-related management is taken into account.

Indeed, AI could add $170 billion to the global banking sector's profit pool by 2028. And banks are aware of this, even if they are hesitant to deploy the technology. Nearly all (93%) of financial institution respondents to a recent Citi customer survey said adopting AI would improve their profitability in the next five years, primarily through its ability to automate repetitive tasks currently performed by human workers, like data entry and the dreaded Excel files.

Challenges of AI adoption

Despite the measurable benefits, Citigroup predicts that financial services will drag its feet, slow to adopt AI compared to other industries. Citigroup attributes this to the “highly regulated” nature of the sector and the lack of globally agreed rules. “Bankers may think they are leading the way,” Citigroup writes, “but many users are adopting technology faster than banks or large corporations,” a phenomenon it characterizes as “the crowds running before the crown.” .

After all, AI is hardly sophisticated enough at this point to operate independently. A “bot-powered world,” as Citigroup puts it, would still struggle with compliance, data security and basic ethics, because “AI models are known to hallucinate and create information that does not 'do not exist'. Hardly a minor business risk.

To learn more about the impact of AI on financial services, check out this detailed article.


Beware of Financiers: AI Targets Banking Before Any Other Job, Warns Citigroup

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