Since the explosion of generative AI earlier this year, enterprises have raced to roll out strategic plans for its adoption. 91% of businesses in a recent Colt study intend on adopting AI in some form – up from 33% since December 2022. Despite, or perhaps driven by, a tight regulatory environment, the financial industry is striding ahead with its adoption of AI to accelerate and enhance a diversity of business applications – and customers are set to benefit.
AI models have been leveraged across the industry to flag and fight fraud for several years. Now, fundamental change is taking place across capital markets and the financial services industry, as it readies itself for AI’s next transformative phase. The responsibility now lies with IT leaders to make sure the building blocks are in place to leverage AI and its new capabilities.
We polled a group of sixty IT leaders in the financial industry as part of our research into enterprises’ use of intelligent infrastructure – the entire IT estate needed to support an organisation’s digital strategy, such as enterprise networks, cloud platforms and software applications. Here are the four key takeaways we gathered:
- AI is important to finance IT leaders
Analysing vast volumes of data to identify predictive trends; complex problem solving; developing a deeper understanding of customer preferences; and automating interactions are key ways generative AI is already transforming the industry. Perhaps unsurprisingly, our poll found 85% of IT leaders we questioned in the finance industry said generative AI is important to their organisation, compared with an average across all industries of 77%. 58% said it was either very important or absolutely essential.
When it comes to traditional AI – search algorithms, recommendation engine or voice assistants, for example, which respond to a simple instruction and perform a specific task – 73% of finance IT leaders we surveyed said it was important, against an average across the entire survey of slightly higher at 77%, while 43% said it was very important or absolutely essential.
- Finance is ahead of the game in AI for Data Analysis and Customer Experience
The industry’s relative maturity in adoption of AI across particular business functions is evident in some of the poll results. Looking deeper into financial organisations’ application of AI revealed some interesting insights: they’re strides ahead in terms of using AI for data analysis, for example, with 53% of financial IT leaders questioned in the poll already using AI in this area, against an overall survey average of 42%. In customer experience, too, the industry is ahead with more than one in two firms surveyed (52%) saying they already leverage AI in this area, compared with an average across all industries of 42%. 53% say they are using AI in marketing, against a survey average of 44%, and in security: 47% are already benefiting from AI against an average of 44%.
Conversely, there are some areas in which finance leaders are not yet using AI – but they appreciate the benefits and plan to in the future. Fewer than one in three (28%) financial industry IT leaders we polled are already using AI in Operations, against an average of 44%, but it’s on their roadmap: more than six in ten (62%) say they’re planning to do so in the future. They’re also a little behind the curve when it comes to leveraging AI in HR (42% against average of 45%) , but almost one in two (48%) plan to; and the same percentage (48%) of IT leaders in finance are not using AI in service/product delivery but they plan to, against a survey average of 43%.
- AI is the turning point in accelerating cloud take-up
AI generates exponential amounts of data – and it’s currently driving an increase in cloud adoption. As part of an organisation’s digital infrastructure estate, cloud offers the ability to scale and flex, ideal for an increase in traffic at critical points throughout the financial year.
Faced with a complex web of regulatory requirements, the finance industry has been cautious when it comes to cloud uptake, but this is accelerating as the industry experiences benefits presented by cloud migration: enhanced security, scalability, cost-savings, real-time access to market data, business continuity and the ability to respond swiftly to changing market dynamics. Research by Publicis Sapient with Google Cloud found that only around one in four (27%) banks host more than 30% of their applications in the cloud, they’re aiming to triple their use of cloud by 2025. Now, with growing uptake of AI across the industry, we’re seeing an uptick in cloud migration.
Our poll results reflect this: when it comes to AI adoption across their organisation, 68% of the IT finance leaders we polled say that private cloud is important while 73% believe public cloud is important. In fact, 18% say private cloud is absolutely essential and one in four (25%) say the same of public cloud.
- Finance IT directors are investing in IT to facilitate AI, security and digital transformation
Our research shows that IT leaders in finance are investing in the network infrastructure they need to level up their digital capabilities. Almost seven in ten (68%) IT leaders we surveyed in the finance industry said they expected their IT/digital infrastructure to grow by up to 30% over the next 12 months, above the overall average of 60%. 18% said the investment in IT and digital infrastructure would be driven by AI and the same percentage cited cloud investment as a key driver. Around one in four (23%) said digital transformation is driving this trend and roughly the same (22%) said security was driving the growth in IT spend.
As it faces huge macro-economic and socio political pressures, the finance industry is going through transformative changes. It’s on the cusp of a digital revolution, and AI has a critical part to play.
What's your goal today?
1. Are you on the Colt IQ network?
Our network connects over 31,000 buildings worldwide powering companies such as Hitachi, Atos, Forbes, Arthur D Little, Brussels Airlines and thousands of others. Find out if you're Colt connected now.
2. Learn about digital infrastructure
We've written thousands of guides and white papers, regularly publish content on our blog and host regular events on everything from enterprise network connectivity, to cloud, digital transformation and the hybrid workforce.
3. Join our team
To learn more about joining our team of over 5000 people around the world, and to browse our current open roles visit https://careers.colt.net/.
