Financial services firms are interested in artificial intelligence, but the number actually using AI is limited, according to a new survey from Broadridge Financial Solutions, a fintech firm serving brokerages, banks, asset managers and corporate issuers.
Broadridge, whose stock (BR) joined the S&P 500 this week, surveyed close to 200 representatives from financial firms, including wealth managers, banks and broker-dealers, as well as technology vendors and regulators, asking about their use of AI, machine learning (ML) and robotics process automation (RPA).
It found that 80% respondents are at least assessing the value of at least one of these processes but only about 22% have actually put any in production. Thirty-nine percent of respondents are in the prototype or pilot-testing stage for these technologies.
Respondents “indicated that data-specific challenges are preventing their firms from taking advantage of AI’s potential benefits,” according to the survey. Just over 50% cited “data quality and standardization,” while roughly 40% mentioned data availability, business justification and cost of implementation as impediments to using AI and related technologies.
Nearly all respondents recognized the benefits of developing key AI processes with other firms or vendors such as sharing costs. One-third of respondents expect that AI will reduce demand for labor by 10% or less in the next three years. Less than 5% anticipate a 50% or more drop in labor demand during the same period.
“AI has the power to completely transform financial services,” said Mike Alexander, President of North America Wealth and Capital Markets Solutions, in a statement, “however, many capital markets firms struggle to make a business case for the investment in AI, especially since their data is decentralized.”
— Check out A Digital Wake-Up Call for Wealth Management on ThinkAdvisor.