AI Could Destroy Traditional Banking As We Know It

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Artificial intelligence (AI) is poised to massively disrupt traditional financial services. The World Economic Forum identifies nine ways AI is creating new threats, new opportunities, and new competitive forces for financial institutions. The result may be a marketplace where only the largest and most specialized niche players survive. Subscribe to The Financial Brand via email for FREE!Mid-size and small banks and credit unions could soon find themselves at a serious competitive disadvantage. Ongoing developments in artificial intelligence have the potential to significantly change the way back offices operate and the experiences consumers receive from financial institutions.


How artificial intelligence is transforming the financial ecosystem

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From cost center to profit center: Institutions will turn AI-enabled back-office operations into external services, both accelerating the rate at which these capabilities improve and necessitating others to become consumers of those capabilities to avoid falling behind A new battlefield for customer loyalty: As past methods of differentiation erode, AI presents an opportunity for institutions to escape a "race to the bottom" in price competition by introducing new ways to distinguish themselves to customers Self-driving finance: Future customer experiences will be centered around AI, which automates much of customers' financial lives and improves their financial outcomes Collective solutions for shared problems: Collaborative solutions built on shared datasets will radically increase the accuracy, timeliness, and performance of non-competitive functions, creating mutual efficiencies in operations and improving the safety of the financial system Bifurcation of market structure: As AI ...



How AI will change banking - Chris Skinner's blog

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This report is the culmination of one year's worth of research, including over 200 interviews with subject matter experts and seven global workshops, prepared by the World Economic Forum, and the full report can be downloaded here.


Five Innovation Trends That Will Define Banking in 2019

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The global banking sector is becoming both more strategically focused and technologically advanced to respond to consumer expectations while trying to defend market share against an increasing array of competitors. A great deal of emphasis is being placed on digitizing core business processes and reassessing organizational structures and internal talent to be better prepared for the future of banking. This transformation illustrates the increasing desire to become a'digital bank'. The importance of innovation and developing new solutions that take advantage of data, advanced analytics, digital technologies and new delivery platforms has never been more important. We are seeing organizations innovate in targeting, expanding services, re-configuring delivery channels, delivering proactive advice, integrating payments and applying blockchain technology.