Finastra Survey Reveals Financial Industry’s Embrace of AI, Embedded Finance, and BaaS
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In a recent survey conducted by Finastra, the global financial services sector’s determination to embrace cutting-edge technologies has come to the forefront, as outlined in Finextra News. The annual «State of the Nation Survey» shed light on the industry’s fervent investment in Artificial Intelligence (AI), embedded finance, and Banking-as-a-Service (BaaS).
The comprehensive survey, which collected responses from 956 industry professionals spanning countries like France, Germany, Hong Kong, Singapore, Vietnam, Saudi Arabia, UAE, UK, and the US, painted a vivid picture of the sector’s enthusiasm for innovation. An overwhelming 87% of participants expressed their excitement about the rapid pace of change, while 83% eagerly anticipated the new opportunities these advancements would bring to their financial organizations. An equally impressive 81% shared their excitement about witnessing industry-wide transformations.
One of the standout findings from the survey was the financial institutions’ keen interest in Generative AI. A staggering 83% of respondents indicated their industry’s eagerness to deploy AI technology, with 37% having already implemented or enhanced their AI capabilities in the past year. A significant 32% of respondents revealed plans to utilize AI to enrich customer experiences and offer more personalized services. Other prominent areas for AI implementation included ESG (Environmental, Social, Governance) analysis, automation, KYC (Know Your Customer), AML (Anti-Money Laundering), and risk management processes.
Furthermore, the survey uncovered a rising fascination with Banking-as-a-Service (BaaS). Nearly half of the respondents reported either having used BaaS or enhancing their BaaS systems within the last 12 months, indicating a significant uptick compared to the previous year.
Despite the challenges posed by the economic climate within the tech sector, the survey brought to light the industry’s optimism. A remarkable 69% of institutions believed that their investments would resume during the first half of 2024. Additionally, the majority of respondents acknowledged the transformative power of open finance, with 46% revealing that half of their users were leveraging open banking-enabled services.
Simon Paris, the CEO of Finastra, shared his insights on the survey’s findings, stating, «Despite the challenging economic climate, it’s clear from our research that investment in AI, BaaS, and embedded finance remain key priorities for financial services organizations over the next 12 months, particularly as they seek to further enhance and personalize the customer experience. We share the industry’s ongoing commitment to ESG initiatives, to collaboration around open finance, and excitement in using advanced technologies like AI to help deliver on the opportunities ahead.»
This Finastra survey underscores the financial industry’s unwavering commitment to leveraging technological innovation to redefine customer experiences and drive the sector’s evolution in the coming years.