Almost 85 per cent of tasks and activities in financial services firms would benefit from generative AI technology, according to a new research study by Fifty One Degrees, a London-based AI consultancy.
Generative AI assistants built to support team members with one or more specific functions will benefit over three-quarters of tasks performed by financial services and insurance firms, Fifty One Degrees has revealed.
The AI consultancy analysed 311 tasks and activities spanning 14 functions in banks, insurance companies and financial services firms, and considered which AI technologies would benefit each task and an expectation of how much benefit would be created.
Generative AI assistants are trained on specific policies, procedures and regulations. They are most impactful for functions where large volumes of natural language information are processed, such as compliance, legal, risk management and underwriting. In some cases, AI assistants will make employees more efficient, whereas in other places they will automate some of the workflows altogether.
Nick Harding, co-founder and CEO of Fifty One Degrees, commented: “The UK financial services industry is a powerhouse that fuels the local economy by servicing consumers and businesses, but is also the UK’s biggest export.
“Enabling this industry, which is so critical to our collective success, to remain at the forefront of technology is something we’re passionate about. Assertively adopting generative AI will enable UK financial services to grow further, enabling this vital sector to remain a global leader.
“And this is just the beginning. This study represents the generative AI technology and tools that are available today. What we’ve experienced is rapid development and evolution of the technology and its capabilities, meaning the opportunity for businesses to benefit will only increase.”
Generative AI boosting economic output
The firm’s analysis shows that analytics and data science, technology, customer services and underwriting functions can both increase efficiency and the quality of work delivered through the use of generative AI. Other functions such as compliance, enterprise risk and legal will benefit significantly from efficiency gains, but the quality of work is unlikely to increase at the same rate.
Recent research estimates that generative AI will drive $2.6trillion to $4.4trillion annually in value for global companies. Within financial services and insurance, that figure is $200billion to $340billion – equivalent to nine to 15 per cent of operating profits. The UK financial services and insurance industries produce £278billion of economic output.
A 15 per cent boost would generate a staggering £41.7billion of additional economic output. Further, the UK financial services industry equates to 8.3 per cent of the entire UK economy and 2.5 million people are employed in the sector. Therefore, any gains made by financial institutions would have far-reaching impacts across the wider UK economy.
