AI to drive financial industry profits to $2 trillion by 2028
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According to a Citi report, AI could boost global banking, helping boost profits by 9% or $170 billion from just over $1.8 trillion to close to $2 trillion. AI is expected to be the General-Purpose Technology (GPT) of the 2020s-2030s and will revolutionize finance by changing operations and security and creating new concepts of intellectual property protection worldwide. Also Read: Experts Highlight AI’s Role in Guiding Financial Decisions in Next-Gen Banking AI-generated insights are vital in combating real-time payment scams, such as authorized push payment (APP) fraud. APP fraud is responsible for 40% of banking fraud losses in the UK; the total cost is expected to be $5. 25 billion in the US, UK, and India by 2026 if left unmitigated. Global AI policies diverge as the EU, China, and Singapore lead While some countries, such as the European Union, China, and Singapore, have set policies on AI in finance, the United States has been slow and passive. India had followed a policy of non-interference at the beginning of 2023. However, by mid-2024, due to the changing directives and advisories, the country had planned to introduce comprehensive laws for AI. AI can provide a significant increase in development productivity, with productivity improvement ranging from 10% to 50%. This could mean potential annual cost reductions of between $2 billion to $16 billion within the US banking sector. These efficiency improvements are attributed to the new age AI-based software applications that automate tasks that were earlier managed by technological personnel. The report expands on the roles of AI and compares it to the steam engine of the industrial revolution and the internet. As a result of improving analytical capacities, decision-making, and content, AI will be able to create a new economic model and challenge current conventions. Generative AI advances from proof of…
Filed under: News - @ June 22, 2024 9:12 pm