Banking and AI, double edged sword or necessity?

While AI offers exciting possibilities for security and efficiency, it also raises concerns about data privacy and potential bias.

AI in banking: A double-edged sword for security and ethics
Artificial intelligence (AI) is transforming the banking industry, but it’s not without its challenges.

AI bolsters security measures

Millions of people use banking services daily, making them prime targets for fraudsters. AI is revolutionizing security by helping banks detect suspicious activity in real time.

“AI can analyze vast amounts of data to identify abnormal patterns and system vulnerabilities, potentially thwarting fraudulent activity,” explains Doros Hadjizenonos, regional director at cybersecurity firm Fortinet.

“This surpasses human capabilities and allows for faster, more informed decisions.”

Building trust in AI-powered banking

While AI offers clear benefits, banks must address potential vulnerabilities like data breaches.

“Improper data handling or inadequate security systems can expose sensitive customer information,” warns Hadjizenonos.

There’s also the risk of AI systems themselves being compromised.

“AI can lower the barrier to entry for cybercrime, allowing attackers to develop sophisticated malware,” says Hadjizenonos.

“However, the good news is that AI can also empower cyber defenders with intelligent automation and advanced defense strategies.”

Transparency is key to building trust with customers.

“Banks should be upfront about their use of AI and how it protects data and mitigates security risks,” advises Hadjizenonos.

“Obtaining clear consent from customers ensures their data is used responsibly.”

Balancing security with ethical practices

Banks need to strike a balance between leveraging AI for security and upholding ethical practices.

AI algorithms can perpetuate biases based on factors like race, gender, or location. This could lead to unfair access to credit, investment options, or even customer service for certain individuals.

“Banks should be smart about AI integration,” emphasizes Hadjizenonos.

“Partnering with providers committed to security and accuracy is crucial. Additionally, teams working with AI models should be trained on best practices to mitigate bias.”

AI plays a vital role in safeguarding the banking industry, from identifying suspicious transactions to adapting to evolving cyber threats.

However, it’s crucial to address the challenges of data privacy and potential bias to ensure AI serves as a force for good in the financial landscape.

Also read: Four key takeaways in tomorrow’s digital insurance industry