AI in Finance: Five Ways It’s Transforming the Industry

The rapid evolution of AI and generative AI has created a wave of opportunities for the finance sector. Yet, for many financial organisations, the practical uses of these technologies remain unclear. Combine this with legacy systems and heavy regulatory demands, and adopting AI can easily slip down the priority list.

This blog explores five actionable AI use cases that are reshaping finance that aren’t just ChatGPT. These examples show how targeted AI initiatives can maximise efficiency, cut costs, and unlock AI’s potential.

Automating Regulatory Compliance with AI

Compliance is one of the most resource-heavy challenges in finance. Regulations evolve constantly, making it difficult for teams to keep up without significant manual effort. Failing to meet these requirements risks penalties and reputational damage.

AI offers a smarter solution. By automating compliance monitoring, it enables financial institutions to continuously review data, flag potential breaches, and ensure adherence without the need for extensive manual oversight.

Example: A financial company we recently partnered with had previously relied on a dedicated team to manually monitor and verify customer interactions, limiting them to reviewing just 1% of all interactions. After adopting generative AI tools, they expanded compliance monitoring coverage to 97%, enabling real-time detection of errors and misconduct. This shift not only ensured continuous compliance but also reduced costs and freed up resources for more strategic initiatives.

Modernising Legacy Systems with Generative AI

For many financial institutions, legacy systems are both a strength and a burden. While they’ve provided stability for decades, these systems now limit scalability, slow processes, and make digital transformation a daunting task.

Generative AI offers a way forward, simplifying modernisation by supporting or automating code migration, system updates, and process documentation. This reduces the time, cost, and risk associated with large-scale transitions.

Example: We recently worked with a New Zealand bank to leverage AI to migrate from their on-premises systems in SAS to cloud-based platforms like Databricks. By doing so, they’ve not only improved data handling and governance but also enhanced their ability to scale operations quickly. AI is helping financial institutions future-proof their tech stacks, making them more agile and competitive in a rapidly evolving market.

Enhancing Data Governance with AI

Strong data governance is critical for maximising the value of financial data while maintaining privacy and regulatory compliance. However, managing and securing vast amounts of data is challenging without automation.

AI steps in by automating tasks like data classification, cleaning, and privacy management. This enhances accuracy, reduces human error, and frees up resources for higher-value work.

Example: A bank used AI to classify sensitive customer data, ensuring compliance with privacy regulations. Another used AI to clean up historical transaction data, improving reporting accuracy and customer insights. These improvements translate into significant operational efficiencies and a stronger competitive edge.

Improving Customer Experience with AI-Powered Solutions

Customer service in finance has long been a pain point, with repetitive processes, and a lack of personalisation driving customer frustration. AI is changing this.

Generative AI-powered chatbots and virtual assistants provide 24/7 support, answering queries in seconds and guiding customers through tasks like balance checks or financial advice. With natural language processing (NLP), these interactions feel human, creating a seamless experience.

Example: US banks using AI chatbots now manage millions of customer queries, resolving common issues faster and more accurately (Mastercard,2023). This not only enhances customer experiences but also enables staff to focus on complex tasks, driving overall efficiency.

AI as a Competitive Advantage in Finance

Early adopters of AI in finance are already reaping significant benefits, from streamlined decision-making to better customer service. Generative AI processes vast amounts of data faster than traditional methods, enabling quicker, more informed decisions.

Did You Know?

Nearly half of early adopters expect over 100% ROI within three years - Ecommerce News, 2023
As AI continues to evolve, those investing in it now will lead the way in future-proofing operations and embracing innovations like block chain and deep learning - Forbes, 2020

Building Your AI-Driven Future

AI is reshaping the financial landscape, addressing critical challenges like compliance, legacy system modernisation, and customer experience. With its ability to streamline operations, reduce costs, and drive innovation, AI is no longer a luxury—it’s a necessity.

The organisations that embrace AI today are positioning themselves for long-term success in an increasingly competitive landscape. Now is the time to explore how these technologies can transform your operations and unlock their full potential.

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Written by | Deidre Bredenkamp, Senior Data Scientist at Data Insight

Deidre specialises in advanced data analytics, AI solutions, and reinforcement learning. With a Master’s in Advanced Data Analytics, she is passionate about leveraging data-driven insights to drive innovation and deliver impactful solutions for clients.

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