IDC defines artificial intelligence (AI) as a system that learns, reasons, and self-corrects: a system that hypothesize and formulate possible answers based on available evidence. The system can be trained through the ingestion of vast amounts of content and can automatically adapt and learn from its mistakes and failures.
The IDC report, Many Things from the Shiny New Thing: 20 Early Adopters of Artificial Intelligence in Asia/Pacific Financial Services (FSIs), revealed that early adopters of AI in Asia-Pacific do so with any one of several goals: ability to offer superior customer and employee experience; augmentation of operations to the design; and launch of new products and services.
Most of the AI initiatives by financial services institutions (FSIs) in Asia/Pacific have been ad hoc pilot projects or a part of fragmented, siloed experiments by various product units, functions, and business – IT teams throughout the enterprise.
IDC Financial Insights research manager, Sneha Kapoor, observed that the investigation into AI is deemed to have a high need for localization to ensure that algorithms used by institutions are sufficient and suitable for each Asia/Pacific market.
“The localization of AI is crucial for AI use cases: chatbots and recommendation engines, to capture local nuances and slang; credit decisioning, behavioural scoring despite thin files in developing markets; and fraud analytics, to understand unique transaction patterns,” she added.
According to IDC only a small number of FSIs have articulated AI as a core strategy in support of long-term goals. Still missing is the concept of "AI at scale".
To achieve more favourable results from their AI implementations, FSIs need to think and prepare themselves for five critical elements: strategy and sponsorship; process identification and optimization; people and change management; scalable infrastructure; and data and model life-cycle management.
The advancement on each of these elements will determine how an institution perceives and utilizes AI for success.
Kapoor predicts that by 2022, more than 50% of Asia/Pacific FSIs to invest in one or more AI technologies.
“Majority of projects will focus on three objectives: transform the customer experience, optimize operational efficiencies, and create new revenue streams. We also believe that AI will be one of the key technologies to drive institutions through digital business transformation and accelerate innovation among institutions – given that it has already at least doubled the rate of innovation improvements in FSIs in the region,” she continued.