Ground-breaking AI technology is helping banks to tackle complex compliance and regulatory issues, manage risk and also to bust fraud
Nobody in the financial services sector would argue that the impact of increasing regulation and increasingly large fines for regulatory failures has built steadily over the last decade. Nor, for that matter, that risk and compliance is now one of the largest areas of spending within the industry. It hasn’t been exactly uncommon for banks to have increased their budgets over this period by 15 to 25 per cent a year in this area alone. “It is now reaching saturation point,” argues Jeremy Doyle, associate partner with Watson Financial Services at IBM UK. “Continued spend is becoming untenable and there is increased urgency to find ways of reducing cost, while remaining compliant, protected and in a position to drive growth.”
Luckily, during this same period, the maturity of technology in cloud computing, machine-learning and artificial intelligence (AI) has accelerated dramatically while the entry cost declines. So are AI and machine-learning now driving the next generation of regtech solutions to reduce fraud in the financial services sector?