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Banking summit in London discusses digital dominance concerns

A meeting of specialists highlights the increasing demand for online banking services despite the growing electronic fraud crimes and the challenges of facing the acceleration of artificial intelligence.

اجتماع لمتخصصين يسلط الضوء على تزايد الإقبال على الخدمات البنكية عبر الإنترنت رغم تنامي جرائم الاحتيال الإلكترونية وتحديات مواجهة تسارع الذكاء الاصطناعي

Digital technologies are driving innovation and change in the banking industry, which is undergoing major transformations, while mobile banking, artificial intelligence, chatbots, open banking and cryptocurrencies are just a few of the digital banking trends reshaping the industry.

In addition, personal banking, voice banking and cybersecurity will shape the banking industry in the coming years, with customers increasingly demanding more innovative and convenient banking services, while banks that are slow to adopt these trends risk losing customers.

Expectations indicate that the global basic banking software market will grow from $14.54 billion for the current year to $47.37 billion by 2030, after the value of this market reached $12.51 billion in 2022, according to a report by Fortune Business Insight.

Today, traditional banking models are struggling to meet increasing customer demands in light of the growth of digitization and the accelerating pace of artificial intelligence, as more than 70 percent of banking transactions in the world today take place via the Internet, which highlights the growing preference for digital banking services despite the rise in electronic fraud crimes. Which the banks that benefited from digitization were not spared, as it enabled them to reduce costs, so that banks no longer needed dozens of branches and hundreds of employees.

“The connection of banks to the digital landscape and the call for banks to adopt transformative technology” was the broad title of the “The Future of Core Banking - 2023 Edition” summit, which was launched today, Tuesday, in Kingston, Britain, with the participation of a large number of banks, banking technology services companies, specialists and financial analysts.

The summit represented an exciting platform that brought together industry leaders, visionaries and technology enthusiasts to explore the developments shaping the future of core banking, and ignited a dynamic exchange of ideas, strategies and transformative solutions that are redefining the banking landscape.

Innovation and digital transformation in the banking industry

With a focus on fostering innovation, embracing digital transformation, and improving customer experiences, speakers at the summit discussed the potential of emerging technologies such as artificial intelligence, blockchain, and open banking, pushing core banking into a new era of efficiency, flexibility, and integration, stressing the importance of customer focus by providing insight. Comprehensive to the rapidly evolving banking ecosystem.

The acceleration of the development of core banking platforms over the past years has been driven by important technological trends, the rise of financial technology companies and major technology companies, and the changing landscape of customer preferences.

During their talks, banking industry specialists agreed that successful banks in 2030 will be the ones that will master the data-driven customer experience across channels supported by artificial intelligence and automated automation, and noted that consumers today are more aware of the value and importance of their personal data and the importance of keeping it safe and secure.

In a recent report by the giant accounting firm KPMG titled “The Future of Digital Banking Services,” it said that “the picture of the banking industry will be different in 2030 than it is today,” adding that “some of what we see will be evolutionary and others will be radically different.” She explained, "Although predictions for the future are usually surrounded by doubts, she is confident in the future of growing digital competitiveness in the banking services industry."

Managing risks associated with artificial intelligence

With the acceleration of the use of artificial intelligence in the world of banking, concern is increasing about the challenges that accompany the smart revolution. For example, but not limited to, numbers are no longer the “secret code” for the depositor’s or customer’s account, as “voice ID” has become prevalent in most banks to identify... The identity of the account holder, which opens the door wide to fraudulent operations through the artificial intelligence portal, such as imitating the voice of a bank employee or customer and then accessing accounts without the customer’s request.

These concerns prompted a senior US central bank official last April to reveal that the Federal Reserve is holding “regular discussions” with the banks it supervises regarding managing risks associated with artificial intelligence, as more financial institutions use artificial intelligence in... Customer service, fraud monitoring and underwriting applications.

Earlier, US Federal Reserve Governor Christopher Waller warned that although artificial intelligence could bring new efficiencies to banking operations, it also entails new risks, including difficulties in detecting problems or biases in large data sets.

He added that "so-called smart contracts or self-executing transactions on the block chain or 'Blockchain'" whose results depend on pre-programmed inputs, could hold 'great promise' for modernizing transaction settlements. However, he pointed out that "smart contracts also constitute... "Dangers such as vulnerabilities and cyber errors."

Achieve balance

According to Chris Lovejoy, global cybersecurity and resilience officer at the American IT infrastructure services provider Kendrill, there are three ways that banks can protect themselves from the dark side of generative artificial intelligence. He explained, “When dealing with banking clients globally, most conversations turn "We quickly turn to generative AI, both the exciting opportunities and the real-world dangers," he said, adding, "While banks are keen to adopt generative AI to improve fraud detection, increase internal productivity and further transform the customer experience, they are also reluctant to go beyond narrow pilot applications." Pointing out that the main reason for this hesitation is “trust.”

“The foundation of banking is built on trust, and while technology helps most institutions deliver services faster and easier, strong regulation guides how these services are delivered,” Lovejoy said.

He continued, "In addition, generally accepted frameworks and standards influence security management and privacy protection, while this process and policy infrastructure works to create trust across the system."

Lovejoy called on banks looking to deal with artificial intelligence projects to consider the standards of this intelligence and pay attention to the risks, saying, “While artificial intelligence is very attractive and has good intentions, it also has the potential to cause chaos if it is not properly directed and managed.” ".

He also called for setting appropriate protection and governance barriers from the beginning so that artificial intelligence can act as a reliable companion in the global banking system, stressing that it is crucial that these barriers work to achieve an appropriate balance between managing risks and enabling sustainable innovation and growth.

Digital banking 'industry standard'

Banking industry specialists believe that with the introduction of digital technologies, the banking industry has witnessed a major transformation over the years. With the emergence of digital banking services, customers can now access banking services from anywhere and at any time, which makes the industry more efficient and convenient, adding that with the spread of... Digital Technologies Digital banking is on track to become the industry standard.

Mobile banking

Industry professionals also spoke of the increasing popularity of mobile banking in recent years, as customers prefer to conduct banking transactions on their smartphones.

They pointed out that mobile banking services have become a popular choice for a number of customers due to their ease of use, pointing to Statista’s expectations that the number of mobile banking users will reach 1.75 billion users by 2024.

But at the same time they warn that banks that are slow to adopt mobile banking risk losing customers as mobile banking grows in popularity.

Artificial intelligence and chatbots

The attendees agreed that artificial intelligence and chatbots have transformed the banking industry by providing customers with specialized banking experiences, as “Chatbots” have become a major part of customer service, providing assistance around the clock and resolving customer inquiries immediately.

Voice banking

Another trend that is likely to shape the future of banking services is voice banking, as voice assistants such as “Amazon Alexa” and “Google Assistant” have become more widespread, and customers can use voice commands to conduct banking transactions, making banking services more convenient. .

Open banking

The speakers also touched on the file of open banking services, which is a growing trend in the banking industry and which allows external service providers to access customer data via open application programming interfaces, allowing banks to cooperate with financial technology companies and allowing customers to access a variety of financial services through the platform. One, and because it allows customers to access a variety of financial services through a single platform, open banking has the potential to transform the banking industry, they say.

The panellists concluded that the future of banking services is digital, as technology plays a crucial role in transforming the industry with digital banks gaining popularity, especially among the millennial generation who prefer to conduct banking transactions online.

But in the end, they warned that with the increasing popularity of digital banking, cybersecurity will become more important, so in order to protect customer data and prevent cyberattacks, banks will need to invest in advanced cybersecurity measures, and to identify and prevent fraud, advanced technologies such as biometric authentication, artificial intelligence and learning will be used. Automated.



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