
Technological Trends in Banking and Investment Services
CIO Review APAC | Tuesday, August 30, 2022

Banks and Investment Firms will Spend USD 623 Billion on Technology Products and Services in 2022
FREMONT, CA: In 2022, generative artificial intelligence (AI), autonomic systems, and privacy-enhancing computation will become popular technological advancements in banking and investing services. Over the next two to three years, these technologies will keep advancing and aid in the development and transformation of financial services. While growth is the top priority, the need to manage risk, optimise costs and increase efficiency also requires new technology innovations. While autonomic systems and privacy-enhancing computation are long-term solutions that give new possibilities for business transformation in the financial services industry, generative AI enables bank CIOs to deliver technology solutions in pursuit of revenue growth.
Global IT spending by banking and investment services companies will increase 6.1 percent to USD 623 billion by the end of 2022. IT services, which include consultancy and managed services and account for 42 percent of all IT spending in the industry at USD 264 billion, are the largest segment of spending. The software domain is expected to experience the biggest growth, with spending rising by 11.5 percent to USD 149 billion. The three emerging technologies have proven applications in the banking and investment sectors and jointly contribute to the objectives of operating, expanding, and transforming a business.
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Generative AI
By 2025, 20 percent of all test data for consumer-facing use cases will have been generated artificially. Generative AI creates original new works that are comparable to the original but do not replicate it by learning a digital representation of an artifact from data. Generative adversarial networks (GANs) and natural language generation (NLG) are often used in banking and investing services for risk factor modelling, trading prediction, fraud detection, and synthetic data synthesis. It has potential since it can increase personalisation to a whole new level.
Autonomic Systems
Autonomic Systems are self-managed machines or computer programmes that adapt to their surroundings and dynamically alter their algorithms in the present to improve their performance in intricate ecologies. They offer a flexible set of technological abilities that can adapt to changing conditions and requirements, improve performance, and guard against intrusions without human participation.
Currently, autonomic systems are largely software-based in the banking sector. Humanoid robots, on the other hand, are starting to appear in smart branches as examples of hardware-based autonomous systems that serve clients and customers. They might be used in automated lending, personal finance assistants, and autonomous debt management. Although roboadvisors are fundamentally low-level autonomic systems, their high level of automation raises trust issues nonetheless. 20 percent of businesses that offer autonomous systems or devices would demand that clients renounce indemnity clauses relating to the learning behaviour of their goods by 2024.
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