Despite optimism surrounding the application of various emerging technologies in banking, the transition will expectedly not always be smooth be it with regards to technical or softer issues. AI is no exception and banking executives were posed the question at AFF 2020 about their top challenges during implementation.
At DBS, Medhy Souidi, head of fintech and StartupXchange highlighted two challenges specifically relevant to larger organizations. According to Souidi, lack of standardization when structuring of data and a non-uniform data processing workflow between the various divisions at the bank have created a hurdle for better input into AI systems.
Souidi also highlighted risk management as a key challenge, stressing that the matter is mandatory and that any related strategy cannot become a black box.
Ping An OneConnect Bank
Ryan Fung, chief executive at Ping An’s fintech arm, emphasized external collaboration as a key challenge and highlighted hurdles such as the willingness of the public to share data or fore corporate to collaborate with banks. Secondly, he also named tech awareness as another challenge due to the ever-evolving field of technology and the benefits of solving a problem through existing solutions in the market. Thirdly and perhaps most importantly, is the challenge of convincing internal stakeholders.
«AI is not just about making processes more efficient but also bringing a new operating model. How we embrace this change and convince internal stakeholders is equally challenging and critical,» he said.
Toby Chen, deputy general manager of the AI Group at Tencent’s digital banking arm WeBank, pointed out a uniquely unnamed variable that poses chillness to implementation: regulations. According to Chen, the stricter the regulatory environment, the more difficult it would be to develop and maximize the potential of AI.
And on this matter, the local regulator was quick to jump in and provide reassurance of its commitment to a pro-innovation environment. The Hong Kong Monetary Authority’s chief fintech officer, Nelson Chow, reminded the audience of the watchdog’s recently issued circular which encouraged banks to experiment on alternative data with a small portfolio of their loan book through a sandbox approach.
«Of course we can’t say explicitly but AI is the tech we want banks to explore within a risk-contained environment,» Chow said.
News Source: Link