Banks Fear Fast-Tracking AI; 52% are Falling Behind

Bankers live up to their reputation as the world's worst innovators!

The American Banker surveyed 127 senior bankers in the US and got a fascinating view of the AI world, slightly different from the hype we get from consultants.

I wrote a book about innovation, and bankers are among the world’s worst, so expecting them to embrace AI enthusiastically is unrealistic.

Still, in a shocking result, only 12% of banks are focused on small-scale AI implementation.

A whopping 52% are in the still learning phase or less and are falling behind.

Perhaps even more telling is that 61% of bankers surveyed feel that AI “is evolving too quickly.”

That isn’t to say that bankers don’t see the utility of AI, they most certainly do, but largely mistrust it and are reluctant to adopt it.

👉TAKEAWAYS

🔹 Of the banks surveyed, only 6% of the largest Global/National banks ($100bn+) were moving forward aggressively with AI. Smaller banks had none in this category!

🔹 61% of the 127 bankers who responded said they were using generative AI either in their personal or work life.

🔹Banks that use the technology do so for general office tasks (45%); fewer use it for direct client or customer communications (23%).

🔹 Top uses include Improving emails and marketing communications (46%) and helping to fight fraud (36%).

🔹 Less common uses included recruiting and hiring new employees (11%), onboarding customers or clients (12%) and onboarding employees (15%).

🔹 🔥Don’t talk to clients! Only 29% said they were using (or planned to use) generative AI to help contact centers or customer service representatives, even though 69% surveyed trusted AI in this use case. The gap is due to regulation.

🔹 Top concerns about AI include the loss of personal touch with clients (70%) and the introduction of new ethical concerns and bias (57%) followed by skills degradation (50%).

Bankers are not overly confident in AI’s capabilities and gave it lower than 50% trust for the majority of tasksQ! a lower than 50% trust level.

👊STRAIGHT TALK👊

AI is a critical component of bank transformation, and 52% of banks aren’t yet actively engaged!

This group is making a significant strategic error.

Also, 35% of organizations ban or restrict employees' use of ChatGPT! Prohibiting employees from gaining vital skills would seem unduly harsh and self-defeating, even with data privacy issues.

We all acknowledge that banks have legitimate concerns over business risks and regulatory issues but their slow development of AI will solve neither.

Delaying AI development will only compound these problems by failing to develop the internal skills required to manage them.

Just to show how disconnected banks and banners are, 47% of those surveyed worried about AI-related job losses, while a mere 15% of banks are upskilling existing employees to support AI!

Banks, bankers, and AI are definitely not on the same page!

Thoughts?

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