Fear and SkillGap, Not Regulations - Holding Back Implementation of AI in the Banking Sector

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One would think that in the age of Bitcoins, reusable rockets, and gene editing technology, fear of technology would be the last thing someone would be concerned about when it comes to implementation of cutting-edge technology.

But according to a report by TIBCO, where 75% out of 600 banking professionals surveyed believe that increasing use of AI in the banking sector would lead to banks struggling to recruit the necessary expertise.

One of the core issues that the report investigates is about the role that data engineers and data scientists play in the race to digitize, modernize, and AI-fying banks to acceptable 21st century standards. While banks are sponsoring and tying up with universities, hosting hackathon events and what not, the skill gap in this sector remains to be a constant barrier to realizing the AI ambitions of many banks.

Not only this scramble for talent is driving up salaries for Data Engineers and Scientists, but it is also jeopardizing the overall growth that the industry could achieve. A rising wage for these roles would create a wage push inflation which in turn could create fewer jobs as the industry matures and create an entry barrier with high operational costs.

But is the high operational cost all worth it? With many banks still struggling with poor legacy data management issues, could Artificial Intelligence projects be the answer that those banks are looking for?
Nearly 69% of surveyed banks think otherwise, they feel that their lack of proper legacy data management or the complete lack of it will directly hinder their ability to properly step into the AI-centric world.

But can this fear of unpreparedness be attributed to the daunting task of Artificial Intelligence implementation alone? Perhaps not. Nearly 84% of surveyed participants fear regulatory and liability related issues could cause serious setbacks.

In reality, as more and more industries begin to use AI in their business processes, the regulations keep getting updated at an increased pace, take a look at this report for some of those instances.

Artificial Intelligence is a mysterious subject to many people, surrounded by the haze of code trickery and walls of data, to some, even the thought of handling such a project that has anything to do with AI could trigger multiple panic attacks. The only way this can be tackled if banks, firms, or any organisation that is gearing up to use AI in their systems, should at first train their existing leadership and managers about what AI is and what it is not.