Banks' Perspectives on Artificial Intelligence
In a landmark report published last week, the focus of major banks' cross-border payments operations has been under the spotlight, with the analysis covering the earnings of 13 major banks from the start of 2021. The report provides insights into the discussion of artificial intelligence (AI) by these banks and its impact on their operations.
The report reveals that the use of AI has become increasingly popular in discussions across payments, financial services, and beyond. From 2021 to 2024, the discussion of AI in cross-border payments has evolved significantly, shifting from basic automation to advanced AI integration.
Early discussions centered on reducing manual intervention in cross-border payments. By 2024, banks are using AI to perform real-time transaction monitoring, identity graph analysis, and biometric authentication combined with machine learning to fight synthetic identity fraud and detect deepfakes.
One of the key areas where AI is making a significant impact is cybersecurity. With the increasing number of cyber threats, AI-driven fraud detection and compliance tools have become strategic imperatives rather than cost centers for banks. Between 2021 and 2024, losses due to cybersecurity breaches reached billions, making these tools crucial for banks' security.
Major banks and payment platforms are also partnering with AI-powered identity verification companies to improve risk assessment and cross-border payment safety. Companies such as Socure, Onfido, Jumio, and Veriff are leveraging machine learning and biometric data to enhance risk assessment and cross-border payment safety.
AI systems are now integrating multiple global data sources for identity verification, enhancing cross-border payment transparency and security compliance in real time. This integration of multiple data sources allows for a more comprehensive and secure approach to cross-border payments.
The use of AI is not limited to specific banks, with multiple banks discussing its applications. For instance, Bank of America discussed an AI-based advisor and client insights tool in its latest earnings call, while BNP Paribas discussed using generative AI across 150 different use cases. Goldman Sachs discussed the financial opportunities of AI proliferation in the corporate world, particularly around infrastructure and finance.
The report also highlights the expansion of AI to real-time and multi-source data analysis, and its role in optimizing FX rates and transaction efficiency. By 2025, banks like CIMB Singapore introduced platforms that provide seamless cross-border transactions with best exchange rates, indicating a continued evolution since 2021.
In summary, from 2021 to 2024, the discussion of AI in cross-border payments has evolved from automation and process improvements to advanced AI-enabled fraud prevention, identity verification, and cybersecurity, reflecting heightened security needs and operational complexity in major banks' cross-border operations. The discussion of AI by banks extends beyond earnings calls, encompassing a wider digitization-focused transformation journey.
Artificial intelligence (AI) is no longer merely a topic of automation and process improvements in the banking sector, but has evolved to incorporate advanced AI-enabled fraud prevention, identity verification, and cybersecurity by 2024. This shift is a reflection of the growing security needs and operational complexity in major banks' cross-border operations.
Furthermore, the use of AI has expanded beyond major banks, with companies such as Socure, Onfido, Jumio, and Veriff partnering with payment platforms to optimize risk assessment and cross-border payment safety, leveraging machine learning and biometric data.
