LONDON – More and more financial services corporations are touting the advantages of artificial intelligence in terms of increasing productivity and overall operational efficiency.
According to Edward J Achtner, head of generative AI on the British banking giant, many corporations fail to deliver tangible results despite daring statements HSBC.
“Honestly, there is a lot of success theater out there,” Achtner said on a panel discussion on the CogX Global Leadership Summit alongside Ranil Boteju – one other AI leader at rival British bank Lloyds Banking Group – and Nathalie Oestmann, head of NV Ltd consultancy for enterprise capital funds.
“We have to be very clinical about what we do and where we do it,” Achtner told attendees on the event, held on the Royal Albert Hall in London earlier this week.
Achtner explained how the 150-year-old credit institution has been using artificial intelligence since ChatGPT – the favored AI chatbot from Microsoft-backed startup OpenAI – got here onto the scene in November 2022.
HSBC's head of AI said the bank has greater than 550 use cases across its businesses and functions which are linked to AI – from combating money laundering and fraud using machine learning tools to supporting knowledge employees with newer ones generative AI systems.
As an example, he cited a partnership HSBC entered into with the Internet search titan Google on the usage of AI technology to combat money laundering and fraud. This connection has existed for several years, he said. The bank has also recently develop into more intensively involved with GenAI technology.
“When it comes to generative artificial intelligence, we need to clearly separate it from other types of AI,” said Achtner. “We approach underlying risk very differently in terms of generation because, while it represents incredible potential opportunities and productivity gains, it also represents a different type of risk.”
Achtner's comments come at a time when other figures within the financial services sector – particularly executives at start-up corporations – have made daring statements in regards to the extent of the general efficiency gains and price reductions they see because of this of investing in AI.
Buy now pay later company Klarna says it has harnessed the advantages of AI to offset productivity losses brought on by staff reductions as employees leave the corporate.
The company is implementing a company-wide hiring freeze and has used AI to cut back the whole variety of employees from 5,000 to three,800 – a roughly 24% reduction within the workforce, CEO Sebastian Siemiatkowski said in August. He goals to further reduce Klarna's workforce to 2,000 employees – without specifying a date for this goal.
Klarna's boss said the corporate is reducing its overall headcount amid the potential for AI to have a “dramatic impact” on jobs and society.
“I think politicians should already be thinking about whether there are other alternatives to how they could support people that might be effective,” he said in an interview with the BBC on the time. Siemiatkowski said it was “too simplistic” to say that the disruptive effects of AI could be offset by the creation of recent jobs due to AI.
Oestmann of NV Ltd, a London-based company that gives advisory services to the C-suite of enterprise capital and personal equity firms, addressed Klarna's actions directly, saying headlines about such AI-driven workforce reductions “are not helpful”.
She suspected that Klarna probably realized that AI “makes them a more valuable company” and due to this fact included the technology as a part of its workforce reduction plans anyway.
The results Klarna is seeing through AI “are very real,” a Klarna spokesperson told CNBC. “We are publishing these results because we want to be honest and transparent about the real-world impact genAI is having on businesses today,” the spokesperson added.
“Ultimately,” Oestmann added, “as long as people are ‘adequately trained’ and banks and other financial services companies can ‘reinvent themselves’ in the new age of AI, it will only help us evolve.” She advised financial corporations, “ to continually learn in everything they do.”
“Make sure you try these tools, make sure you make this a part of your everyday life, make sure you're curious,” she added.
Boteju, chief data and analytics officer at Lloyds, pointed to a few primary use cases the lender sees in relation to AI: automation of back-office functions resembling coding and technical documentation, human-in-the-loop applications resembling prompts for sales staff , and AI-generated responses to customer queries.
Boteju stressed that Lloyds is “proceeding with caution” in terms of exposing the bank’s customers to generative AI tools. “We want to get our guardrails in place before we actually start climbing these,” he added.
“Banks in particular have probably been using AI and machine learning for about 15 or 20 years,” Boteju said, signaling that machine learning, intelligent automation and chatbots are things that traditional lenders “have been doing for some time.”
According to the Lloyds manager, nevertheless, generative AI continues to be a young technology. The bank is increasingly fascinated with how it may well scale this technology – but by “leveraging the current framework and infrastructure we have” slightly than significantly shifting the size.
Boteju and Achtner's comments are consistent with what other AI leaders in financial services have previously said. Speaking to CNBC last week, ING Chief Analytics Officer Bahadir Yilmaz said AI probably won't be as disruptive as corporations like Klarna suggest with their public messaging.
“We see the same potential as them,” Yilmaz said in an interview in London. “It's just the tone of communication is a little different.” He added that ING mainly uses AI in its global contact centers and internally for software development.
“We don’t need to be seen as an AI-driven bank,” Yilmaz said, adding that in lots of processes lenders don’t even need AI to resolve certain problems. “It's a really powerful tool. It's very disruptive. But we don’t necessarily have to say sprinkle it on all foods as a sauce.”
Johan Tjarnberg, CEO of Swedish online payments company Trustly, told CNBC earlier this week that AI “will actually be one of the biggest technological levers in payments.” Still, he noted that the corporate is more focused on the “fundamentals of AI” than on transformative changes like AI-driven customer support.
One area where Trustly is trying to improve the shopper experience with AI is subscriptions. The startup is working on a “smart billing mechanism” that goals to determine the very best time for a bank to simply accept payment from a subscription platform user based on past financial activity.
Tjarnberg added that Trustly has seen a rise in efficiency of just about 5-10% by implementing AI in its business.
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