The process of introducing and using artificial intelligence in the functional environment of financial services is currently at an early stage in terms of prevalence and does not belong to the category of generally accepted or widespread practice, but needs monitoring and possibly regulation to prevent potential harm to consumers and ensure conditions for proper operating markets.
The mentioned opinion is held by the European Central Bank (ECB). The corresponding statement was made by the main financial regulator of the eurozone on Wednesday, May 15.
The ECB also noted the significant capabilities of generative artificial intelligence. This implies considerable positive prospects for the use of advanced technology by banks and other institutions operating in the financial services industry. The ECB separately underlined that generative artificial intelligence can become a highly effective tool in solving tasks such as information processing, customer service, and threat detection in the digital space.
The financial regulator also draws attention to the fact that the process of using AI is associated with several potential risks. In the relevant context, ECB experts noted herd behavior, an excessively high level of dependence on a limited number of providers, and cyber attacks that become more sophisticated if criminals apply advanced technology.
The specified bank’s article, published as part of its regular financial stability review, notes that the introduction of generative artificial intelligence needs to be closely monitored as this technology evolves. It is worth clarifying that it is meant for the introduction of AI into the financial system.
ECB experts also admit the possibility that at some point it will be necessary to consider initiatives related to regulating the use of generative artificial intelligence in the financial services industry. According to them, the corresponding potential need will become a mandatory solution, provided that obvious failures related to the implementation of AI are recorded in the market. Moreover, it was clarified that in this case, those failures are meant that cannot be eliminated within the framework of the mechanisms and tools of the existing prudential system.
It is worth noting that the European Union was the first in the world to formulate rules in the area of artificial intelligence. In this region, general-purpose AI systems and advanced technology configurations containing significant risks must comply with specific transparency obligations and EU copyright laws.
The ECB notes that the introduction of generative artificial intelligence systems by European financial companies is in the early stages. The bank noted that market contacts indicate that financial institutions in the eurozone may be slower to launch the practice of using AI due to risks associated, including reputation.
During the period of active proliferation of generative artificial intelligence, the issue of security in the digital environment is becoming more relevant. In this case, it is important for users to be aware of the threats they may face in the virtual space. For example, a query in an Internet search system such as how to know if my camera is hacked will allow anyone to receive information about signs of unauthorized access to the device. Scammers have access to advanced technologies, which makes their activities more sophisticated. In addition to the means of direct technological counteraction, digital literacy is one of the tools to combat cybercrime. Relevant knowledge will help users understand in which case actions or interactions in the virtual environment can cause significant damage to them.
