AI and the Future of Banking

So far, the adoption of AI in banking has been slower when compared to other industries, largely due to customer preference and leadership demographics. According to The Financial Brand, many customers at community banks still prefer human interaction, and bank leadership tends to be older and less inclined to embrace technological change. However, the landscape has begun to change and AI adoption is expected to accelerate as younger generations step into leadership roles and become primary customers. 

According to Bloomberg, “global banks are expected to cut as many as 200,000 jobs in the next three to five years as artificial intelligence takes over tasks traditionally handled by human workers.” A report from Citigroup suggests that banking will be one of the most impacted industries, with 54% of jobs at risk of displacement while another 12% could be enhanced by AI (Forbes). Banking industry professionals who adapt to these changes will have the greatest opportunities in the future. 

Many roles in banking that involve repetitive and predictable tasks are more likely to be replaced by automation. Customer service, data analysis, reporting, and relationship management are already being streamlined by AI. In addition, AI is strengthening cybersecurity by detecting fraudulent transactions more quickly and accurately than human analysts. 

According to Forbes, AI is also making recruiting and client onboarding more efficient, as it has the ability to analyze large amounts of data efficiently and effectively. Machine learning models are being used to test compliance controls, and natural language processing is helping banks quickly interpret new regulations and assess their impact. 

Banks are also creating new roles, particularly in areas such as AI development, data science, and technology. To stay competitive, professionals will need to keep up with AI advancements and continuously develop new skills. Interpersonal and critical thinking skills will be in high demand, as these skills are critical for managing client relationships and making strategic financial decisions. As AI takes over routine tasks, employees will have the opportunity to focus on more complex decision-making and tasks that require human judgement. (Forbes). 

A report from McKinsey suggests that about 30% of banking work hours will be automated by 2030, with entry-level jobs seeing the biggest shift (Financial Brand). Rather than eliminating entire roles, AI will replace specific tasks, particularly those centered around data. Adaptability is key for young professionals looking to enter the field, as those with diverse and relevant skill sets will have more opportunity for advancement. Banks are increasingly looking for employees with strong AI literacy, such as data scientists and engineers, and some institutions are even offering training programs to upskill workers in AI applications (Financial Brand). 

Understanding AI’s growing role in the industry is important for aspiring bankers. Those who can work alongside AI, leverage its capabilities, and refine their analytical and technical skills will be well-positioned for success.