In an evolving digital landscape, Temenos, a leader in banking technology, has revealed the transformative impact of Generative AI (GenAI) on the banking sector. According to a recent survey conducted by Hanover Research, a significant number of banks are exploring the potential of GenAI to revolutionize their operations.
This development highlights the growing enthusiasm for GenAI’s role in enhancing banking efficiencies, customer service, and overall business growth.
The survey, which gathered insights from 420 business and technology leaders within the financial services sector, paints a clear picture of the current and future trajectory of GenAI in banking. A striking 75% of banks are currently investigating GenAI deployment strategies, with 36% either actively deploying or already in the process of integrating this technology. An additional 39% are still evaluating potential deployment options.
The drive for adopting GenAI is rooted in the need to improve operational efficiency, elevate customer experiences, and support sustainable business growth. Nearly half of the banks (43%) that have already embraced GenAI plan to increase their investment in the technology within the next year, further showcasing their confidence in GenAI’s capabilities to enhance their operations.
Despite the growing enthusiasm, the survey also highlights several significant concerns within the banking community regarding GenAI. Data protection is a major concern for many, with 86% of respondents pointing it out as a critical issue.
Additionally, 60% of respondents expressed concerns about the legal compliance of using GenAI, while 59% highlighted the potential risk of GenAI generating inaccurate outputs, referred to as ‘hallucinations.’
Isabelle Guis, Chief Marketing Officer at Temenos, highlighted the excitement and challenges banks face in exploring GenAI’s potential. The technology has the potential to improve efficiency, solve operational issues, and enhance customer experience. However, banks must address concerns about data privacy, legal compliance, and accuracy to ensure responsible and effective use.
A survey shows that 73% of banking leaders believe Agentic AI, autonomous decision-making systems, will be a game-changer in the industry, indicating a growing interest in the next generation of AI technologies, which could significantly transform the way banks operate.
Temenos has introduced flexible deployment options for its GenAI solutions, allowing banks to choose between cloud, SaaS, or on-premises infrastructures. To improve performance and security, Temenos has announced a strategic collaboration with NVIDIA, aiming to enhance on-premises GenAI solutions’ performance, ensuring faster processing, greater precision, and enhanced data privacy.
Temenos’ survey indicates that while banks are excited about GenAI’s potential to improve operational efficiency and customer satisfaction, challenges such as data security, regulatory compliance, and accuracy remain.
However, with increasing investments and strategic collaborations like those with NVIDIA, GenAI’s role in the future of banking is expected to grow significantly. Addressing these challenges will lead to a more efficient and customer-focused banking experience.
