A global perspective
That said, there are different regulatory models and different levels of urgency and adoption with respect to AI in different markets.
Most technology innovation appears to be happening in Asia. Organizations without legacy systems weighing them down have created great value for clients and shareholders alike. Mobile penetration is extremely high and the “digital exhaust" – the trail of data left by consumers' digital and online activities, behaviors, and transactions – is often monitored and used intelligently for customer betterment. In 2017, the Chinese government announced its intention to become a world leader in the AI field by 2030. Asia is in a hurry to advance quickly, and banks in the region are spending a lot of money on technology in general and AI in particular.
In Australia, banks are in a challenging situation. The Royal Commission has entered the scene, and there are a lot of new regulatory oversights. There are protests in the street about banks making too much money, similar to the Occupy Wall Street movement of 2011 in the United States. Australia is adopting AI, but sometimes that adoption feels almost reluctant. According to Genpact's research series, AI 360: insights from the next frontier of business, Australia is lagging behind counterparts in the United States and the United Kingdom when it comes to embracing AI. Only 43 percent of Australians believe AI improves their lives, compared with 48 percent of UK and 59 percent of US consumers.
In Europe, banks are confident, profitable, and perhaps overly comfortable. Resistance to change results in slower AI adoption. Many profitable European banks appear to be taking a wait-and-watch approach to AI. Similarly, banks in Canada have been taking a more passive stance. But we expect to see a very practical, pragmatic approach toward using AI to drive efficiency, speed, value, and safety in Canada, as we see in the United States.
In America, there is also recognition among banks that technology is inevitable as a key driver of success. However, given the cost of investment, some mid-tier banks are struggling to compete. As a result, there is an emerging feeling that some banks are “too small to succeed." In fact, some of the comments regarding recent mergers and acquisitions indicate that the driver for combining organizations was in part due to finding efficiency and investment capital with which to fight this technology war against the banking behemoths with deep pockets who can afford to play an aggressive tech game.