From evolution to revolution: The transformative effect of generative AI in banking
As the old saying goes, "You wait ages for a bus and then two [or possibly three] come along at once." This saying can be updated to reflect life in our increasingly digital world: "You wait ages for a genuine disruptive technology and then two [or possibly three]arrive simultaneously."
This phrase succinctly captures the transformative effects of generative AI (GenAI) and its key underlying elements: Large language models (LLMs), synthetic data generation, and digital twins.
A report from Accenture highlights that banks are more likely to benefit from the highest GenAI productivity gains than any other industry in the US. McKinsey estimates that banking has an annual potential increase in GenAI-driven value of between $200 billion and $340 billion (nine to 15 percent of operating profits) as a result of improved productivity (with the most significant gains coming in the sub-sectors of retail and corporate), it’s clear that GenAI is a genuine game-changer like no other.
HFS Research, a respected independent analyst firm, surveyed enterprise leaders and found that by 2025, GenAI’s impact will be bigger than every other major technological breakthrough in history, surpassing the printing press, steam engine, the internet, and the smartphone. For something that’s only existed for a relatively short time, that’s quite an accolade. And all available evidence points to this being reality rather than hyperbole.
