Fintech researcher Alex Johnson advises banks to focus on ancillary products that will transform their operations, rather than trying to compete with tech giants in building large language models. He believes the combination of generative AI and open banking will drive the financial services industry forward, but warns that banks should move slowly in adopting AI-powered changes due to potential errors and biases in AI models.
Key takeaways:
- President Biden's executive order requiring safety tests before releasing AI models and establishing a common framework for AI adoption may cause uncertainty for bankers planning AI investments.
- Despite the potential regulatory scrutiny, UBS Global Wealth Management predicts strong AI-sector growth next year, driven by tech giants' commitment to robust AI infrastructure spending.
- There is a current bubble in AI investment, with many venture capitalists potentially wasting money on unrealized projects, according to fintech researcher Alex Johnson.
- Johnson suggests that banks should focus on ancillary products like software and APIs that will introduce new workflows and use cases, rather than trying to compete with tech giants in building large language models.