The fourth industrial revolution is underway and it's threatening to wipe out nearly half the jobs in Australia. This latest round is characterised by intelligent robots and machine learning and PricewaterhouseCoopers economist Jeremy Thorpe said it's going to completely reshape the Australian jobs market. "Over the next 20 years approximately 44 per cent of Australia's jobs, that's more than 5 million jobs, are at risk of being disrupted by technology, whether that's digitisation or automation," he said. It seems only a matter of time before intelligence breaks free of its biological bonds - Joe Gelonesi talks to two philosophers with profoundly different visions of technology and the future. Stefan Hajkowicz, who is the principal scientist at the CSIRO, says it's white collar workers who are about to feel the pain.

Digital transformation was taking place in fits and starts before the pandemic, but now digital initiatives are accelerating rapidly. Digitalization using new technologies including artificial intelligence and hybrid cloud are at the heart of this acceleration and this has been more rampant in the financial services sector, also driven by rapid technological innovation and quickly shifting customer preferences. During the COVID-19 global pandemic, the number one business priority was the safety and well-being of employees, businesses also worked overtime to meet the changing needs of clients. Companies turned to AI and machine learning to deliver novel digital customer journeys and eliminate unnecessary interventions in the most routine, repetitive, and paper intensive tasks. Virtual assistants became a critical tool for large organizations and governments during the pandemic. Nearly 43% of businesses globally accelerated their rollout of AI over the last year, according to IBM's 2021 Global AI Adoption Index, as organizations looked to virtual assistants to manage swelling call volumes and other similar pathways to automation.

In April 2021, the European Commission published its draft regulation on AI, the first of its kind, with an aim to develop a bespoke regulatory framework on AI technology. The proposed regulation, if adopted in its current form, looks to introduce: a strict regime and mandatory requirements for "high-risk" AI, such as AI systems used to evaluate creditworthiness or establish credit scores; limited requirements for specific types of AI, such as chatbots; and a ban on certain uses of AI, such as AI systems that deploy subliminal techniques beyond a person's consciousness. The regulation will apply to users and providers of AI based in the EU. It will also regulate providers and users of AI systems that are established in a third country, where AI systems are located in the EU or to the extent the output produced by systems in a third country are used in the EU. The proposed regulation was open for consultation last year.

In July 2019, the FCA announced that it was partnering with the Alan Turing Institute to explore transparency and "explainability" of AI in the financial services sector. On June 11th 2021, the Alan Turing Institute published their report on "AI in Financial Services". This FCA commissioned report highlights the opportunities, challenges and issues involved with AI, and the role of transparency in pursuing AI innovation in the financial services sector. The report is exploratory in its nature, and seeks to provide both a framework and language that will equip stakeholders (including regulators) with an understanding necessary to navigate the evolving landscape of AI in pursuit of responsible and socially beneficial innovation. The report states from the outset that AI is already having transformative impacts on the delivery of financial services and further AI developments in the sector are still to come.

The financial services sector is undergoing digital transformation, and the driving force behind it is machine learning (ML). ML provides systems with the ability to automatically learn and improve from experience without being explicitly programmed. As the finance sector operates on tons of personal data and billions of critical transactions every second, it becomes especially vulnerable to fraudulent activities. Scammers are always seeking to crack the servers to get valuable data for blackmailing. According to PwC's Global Economic Crime and Fraud Survey 2020, respondents reported losses of a whopping $42 billion over the past 24 months due to fraudulent activities.

Like most industries, the financial services sector is being rapidly redefined by emerging new technologies. No longer limited to operating at the transactional level (think mobile banking and digital payments), increasingly advanced tech is encroaching into the more human-dominated roles within the sector. A Bank of England survey recently reported that financial services firms expect to see significant growth in their use of technologies such as Machine Learning over the next three years. These technologies are expected to be brought in to automate processes such as decision making – relying on algorithms to reach conclusions in a quicker, more accurate manner than a human. Aside of these obvious benefits which serve to boost company and industry performance and profitability, there is the added expected advantage that, by gathering the data necessary for this process to occur, the company can also discover new insights that can be exploited for commercial gain.

Artificial Intelligence (AI) is making inroads in the financial services sector, but not without difficulty, and there's still a lot of work to be done before it reaches its potential. This is according to a new report called Smart Money: How to drive AI at scale to transform the financial service customer experience, recently published by the Capgemini Research Institute. The report states that AI is being used at scale among financial services organizations to improve the overall customer experience (CX). Approximately half of customers now interact with an AI on a daily basis, and banks are reaping the benefits: they've reduced cost of operations (13 percent) and increased revenue per customer (10 percent). However, while banks may be reaping the benefits, the customers – not so much.

It should come as no surprise that the financial services sector has been gripped by the innovation of late, particularly when you look at the falling age of the global population and our increased reliance on technology during the digital age. If we look at the forex market, for example, we see that almost half of those active in this space are now categorised as Millennials, with the rise of mobile platforms such as the MT4 having removed many of the barriers that once restricted this marketplace. In today's market, artificial intelligence (AI) is arguably the single biggest and most influential innovation, and one that is changing the financial services sector as we know it. But how is it developing in the market and what's the future for this technology? In many ways, AI has found a spiritual home in the world of banking and wealth management, where trusted professionals and individuals have historically been charged with handling relatively complex calculations and vast swathes of administration.

In areas such as fraud detection, risk management, credit rating and wealth advisory, AI is already augmenting or even replacing human decision makers. In fact, not deploying AI capabilities in these fields can be considered disastrous. Withthe ever-increasing amounts of data that needs to be processed, AI systems are a must-have to improve accuracy. As technological capabilities continue to improve, the amount of available data grows, and competitive pressures mount, the use of AI in finance will be pervasive. However, as with any new technology the adoption of AI brings its very own set of challenges.

Mr. Sunil Khosla, Head Digital Business, India Transact Services LimitedDigital payment is the fastest moving and most dynamic sector of financial services. The thriving growth of digital payments is matched by the pace of technological advancements in the sector which is faster than ever. Affordable internet, smart phone penetration, payment apps, booming e-commerce, and hassle-free online payments have all collectively contributed to the exponential rise of digital payments. We are living in a transformational era of human history where Artificial Intelligence (AI) forms a central part of this transformation. AI has a key role in digital transformation, especially in financial services sector.