Financial Services Industry Needs to Automate or Become Extinct

Financial Services Industry needs to Automate or Become Extinct
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Automation is all about making processes easier and more efficient for humans, and many businesses have now adopted some form of artificial intelligence into their business models. However, there’s still a few companies flailing behind and have yet to make the move. But, if these companies don’t jump on the automation bandwagon soon, it may too late and they may find themselves falling behind their peers and others in the market.

“If these processes are not integrated into financial services firms, then it is likely those firms with more manual or less efficient processes may fall behind their peers and competition,” states Mr. Howie Li, chief executive for Canvas at ETF Securities. He also said it was critical that financial services engage effectively with fintech. Fintech is a general term used to describe the financial technologies that are shaping the emerging financial sector. It has more recently expanded to include other areas of innovation in the financial sector such as investment, retail banking, and crypto-currencies such as bitcoin.

During FTAdviser’s OnAir event that took place on 26 September, Mr. Li also responded to another two questions relating to the integration of AI into the financial services industry. The first question focused on whether the slow integration of AI for some is more of a governance issue, opposed to not having the right technology. The second was whether fintech is just another fad that we would be better off ignoring, or whether it was a long-term trend to invest in.

To answer the adviser, Liz’s, questions during the live webinar, Mr. Li commented: “There is indeed a governance question for sure. The use of artificial intelligence in finance is possible as long as the automation process links into the correct data, analyses and interprets the data in a rules based manner and adapts the outcome based on a set of known processes.”

Not enough insurers are embracing this technological shift towards using AI at the point-of-claims process, claims Julian Stainton, chief executive of private medical insurance (PMI) insurer WPA. “Legacy systems are the bane of all financial devices businesses. We are in a period of constant revolution but large financial firms seem to suffer from corporatitius,” confirmed Stainton. “It seems many big commercial insurance companies still run on green screens and mini mainframes. They’re simply seating the assets to maximize the profits.” The bottom line is that companies need to integrate automation and modern technology into their business models in order to survive.

Original source FTAdviser

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