Edward J Achtner, the head of generative AI for UK banking giant HSBC, said that many companies have still failed to achieve tangible results in the use of artificial intelligence in their activities, despite statements about significant progress in the relevant direction.
It is worth noting that in recent years, firms that provide financial services have increasingly focused on machine intelligence technologies when discussing the issue of improving productivity and overall operational efficiency. Also, the integration of AI into workflows in various industries is becoming an increasingly widespread practice. In this context, it is logical that artificial intelligence is increasingly being used as a tool for performing actions in the financial services area, a significant part of which currently exists in the virtual space. At the same time, applying AI is not an absolute guarantee of success.
Edward J Achtner said that there is a lot of success theater out there. He made the corresponding statement during his speech on a panel at the CogX Global Leadership Summit alongside Ranil Boteju, a fellow AI leader at rival British bank Lloyds Banking Group, and Nathalie Oestmann, head of NV Ltd, an advisory firm for venture capital funds.
The head of generative AI for HSBC also urged participants of the mentioned event, which took place at the Royal Albert Hall in London this week, to be very clinical about what they choose to do and where they choose to do it. In this case, it implies the practice of using advanced technologies, primarily machine intelligence.
Edward J Achtner, during a speech at outlined, as the financial institution of which he is a representative, has implemented artificial intelligence since the debut of ChatGPT, the world’s most popular machine intelligence-based chatbot developed by OpenAI, backed by Microsoft, in November 2022. It is worth noting that in fact this chatbot, which impressed the consumer audience with its cognitive abilities, became a kind of founder of the so-called AI boom, which is currently on an upward trajectory.
Edward J Achtner stated that as of today, HSBC has more than 550 cases of using artificial intelligence in various business lines and functions. According to him, one of the scenarios of applying AI is to combat fraud and money laundering. In this case, machine learning is also used to support knowledge workers with the newest generative artificial intelligence systems.
He also mentioned the partnership between the financial institution and the Internet search giant Google. In this case, the interaction between the bank and the technology company is based on an agreement on the use of artificial intelligence as a tool to counter money laundering activities and a means of mitigating the fraud. According to Edward J Achtner, this tie-up has been in place for several years. Also, recently, a financial institution has shown increasing interest in generative artificial intelligence technologies.
Edward J. Achtner noted that in the context of the approach to generative AI, the bank should clearly separate this category of digital thinking systems from other types of virtual cognition. According to him, the financial institution assesses the underlying risk of generative artificial intelligence very differently. He noted that the mentioned category of AI contains incredible potential opportunities and productivity gains, but at the same time, there is a different type of risk in this case.
Recently, the heads of companies operating in the financial services industry have been actively making statements about the benefits of using artificial intelligence. Within the framework of the relevant rhetoric, a kind of ideological core of which is a high level of enthusiasm for advanced technologies and their capabilities, attention is focused on the overall increase in efficiency. Also, in this case, cost reduction is often mentioned as a result of involvement in the practice of using artificial intelligence. Moreover, in the context of the mentioned rhetoric, attention is very often focused on the benefits of investing in the machine intelligence industry. It is worth noting that such a kind of hyperoptimistic position regarding the possibilities of artificial intelligence within its use in the area of financial services is mainly characteristic of the heads of those fintech companies that are at an early stage of existence.
Klarna, the Swedish firm offering consumers solutions related to the Buy Now, Pay Later (BNPL) category, said that the advantages of machine intelligence help it make up for loss of productivity. The company faced the mentioned circumstance against the background of a decrease in the number of staff. This situation is related to the fact that employees move on from Klarna. Sebastian Siemiatkowski, the company’s chief executive officer, said in August that the firm was imposing recruitment freezing across its entire business. Also, at that time, he noted that Klarna had reduced the total number of employees from 5,000 to 3,800. In this case, the workforce was reduced by 24%. Moreover, Sebastian Siemiatkowski plans to decrease the number of employees to 2,000. At the same time, he did not specify the time frame for achieving the corresponding goal. According to him, the company is reducing the number of employees against the background of the dramatic impact of artificial intelligence on jobs and society.
In August, during a conversation with media representatives, Sebastian Siemiatkowski said that politicians already today should consider whether there are other alternatives to how they could support people that may be effective. According to him, oversimplifications are claims that the disruptive effects of artificial intelligence would be offset by the creation of new jobs as a result of applying AI.
It is worth noting that machine intelligence, in the case of intensive and qualitative continuation of its technological evolution, can become a new form of mind existing in the space of virtual reality and capable of independently cognizing the matter of the being. However, this is a futurological scenario, the implementation of which is likely, but not guaranteed. At the same time, it is already virtually obvious that artificial intelligence will at some point become a new means of production, which will have significant economic consequences that will have a fundamental impact on the situation in the social environment, which will inevitably become a factor of change in the political dimension of the world as a space of the livelihood of human civilization. So far, it is impossible to give an unambiguous answer to the question of exactly what form large-scale processes that go beyond workflows and driven by machine intelligence will take. However, it is obvious that artificial intelligence will become a source of significant changes in the economy, the space of society reality, the political plane, and the cultural environment.
Returning to the topic of using machine intelligence in the financial services sector, it is worth noting that not everyone is enthusiastic about the statements of fintech brands about the incredible results due to the implementation of the practice of applying virtual technology. For example, Nathalie Oestmann of NV Ltd, a London-based company that offers advisory services for the C-suite of venture capital and private equity firms, commenting on the potential of digital thinking systems declared by Klarna, said that headlines around such machine intelligence-driven workforce reductions are not helpful. According to her, the brand probably saw that artificial intelligence made it more valuable and was consequently incorporating the technology as part of plans to reduce its workforce anyway.
The results that Klarna sees from using machine intelligence are very real. The corresponding statement was made by a company spokesperson during a conversation with media representatives. Also in this context, it was separately noted that Klarna publishes the mentioned results because it wants to be honest and transparent about the impact of generative artificial intelligence on firms in the real world at the moment.
Nathalie Oestmann said that at the end of the day, if people are appropriately trained and banks and other financial services companies can reinvent themselves in the new era of artificial intelligence, AI will help to evolve. Also in the corresponding context, she advised fintech firms to strive for continuous learning in everything that these brands do. According to her, the mentioned companies should make sure that they try the specified tools out, make appropriate technological solutions a part of their daily lives, and are curious about relevant efforts.
Ranil Boteju, chief data and analytics officer at Lloyds Banking Group spoke about three options for using artificial intelligence that this financial institution sees concerning AI. In this case, it means such scenarios of applying advanced technology as automation of back office functions like coding and engineering documentation, human-in-the-loop uses like prompts for sales staff, and artificial intelligence-generated responses to client queries.
Mr. Boteju stated that Lloyds Banking Group adheres to an approach in which caution is the main guideline in the context of providing customers with access to machine intelligence tools. According to him, the lender intends to get its guardrails in place before the financial institution actually starts to scale those.
Ranil Boteju stated that banks, in particular, have been using artificial intelligence and machine learning for probably about 15 or 20 years. In this case, he actually stated that machine learning, intelligent automation, and a chatbot belong to the category of things that traditional lenders have been doing for a while. At the same time, according to him, artificial intelligence is a more nascent technology. Lloyds Banking Group is increasingly thinking about how to scale AI, but using existing frameworks and infrastructure, not by moving the needle significantly.
The comments by Ranil Boteju and Edward J Achtner coincide with many other statements about the use of artificial intelligence in the financial technology sector. Last week, during a conversation with media representatives, Bahadir Yilmaz, chief analytics officer of ING, said that machine intelligence is unlikely to be as disruptive as companies such as Klarna suggest as part of their public rhetoric. He also noted that ING sees the same potential, but the tone of communication is a bit different. According to him, the mentioned multinational banking and financial services corporation mainly uses artificial intelligence in its global contact centers and for software engineering.
Bahadir Yilmaz stated that ING does not seek to be perceived as an AI-driven bank. He also noted separately that in the presence of many processes, creditors will not even need artificial intelligence to solve certain problems. According to him, AI is a really powerful tool. In the relevant context, he noted that ING does not necessarily have to say that the company putting it as a sauce on all the food.
Johan Tjarnberg, chief executive officer of Swedish online payments firm Trustly, said during a conversation with media representatives this week that artificial intelligence will actually become one of the largest technological levers in payments. At the same time, he noted that his company focuses more on the basics of AI than on transformative changes, including customer service led by advanced technology.
One of the areas where Trustly plans to improve clients’ experience with artificial intelligence is subscriptions. Currently, the company is working on an intelligent charging mechanism, the purpose of which will be to figure out the best time for the bank to take payment from users of the subscription platform based on their financial activity over the past periods.
Johan Tjarnberg stated that Trustly has already recorded a 5-10% increase in efficiency as a result of applying artificial intelligence as part of its activities.
It is worth noting that against the background of the active development and scaling of the process of using machine intelligence, including in the financial services sector, the issue of ensuring security in cyberspace is becoming more urgent. Scammers also have access to artificial intelligence. For this reason, the activities of the mentioned criminals have become more sophisticated. Digital literacy is important in the cybersecurity area to counteract the corresponding threat, which can cause significant financial losses. For example, a query in an Internet search system such as how to know if my camera is hacked will allow anyone to get information about signs of unauthorized access to the device. It is worth noting that digital literacy is an effective tool for countering cybercrime. At the same time, relevant knowledge should be updated periodically, as technologies are on a permanent development trajectory. For the financial sector, the problem of fraud committed using artificial intelligence is particularly sensitive.
