AI, Big Data, Digitisation, Blockchain: The fintech that will dominate 2018 – Bobsguide (press release)

AI, Big Data, Digitisation, Blockchain: The fintech that will dominate 2018 – Bobsguide (press release)

In particular, the growth of Artificial Intelligence (AI) in the industry will be exponential for three main reasons; hugely increased opportunities for improved customer centricity; ability to ease the regularity reporting burden through AI enabled ‘RegTech’; and massively improved cyber-security and data protection. Remember: AI largely does not do the work that the people do; it does the work that people cannot do. If not that stark, then it does current work far better – in the same way that spreadsheets were an improvement over desktop calculators etc. So why will next year be the year of AI? AI techniques such as pattern recognition, machine learning (ML), and fuzzy logic are already at the core of cybersecurity tools. What will change for cybersecurity will be the complexity and power of AI applications being developed to keep financial and personal data safe. What will also happen is that the current low-level use of machine learning for financial data parsing will sky-rocket, particularly in terms of parsing unstructured data such as company news and news on the customers of companies (the next big area for improved investment and risk management). Part of the regulatory benefits of AI will come from its ability to help in Avoiding the Next Crash, as AI starts to be used increasingly to understand the risk of contagion in financial markets. Regulatory reporting will soon be seen as old hat and ineffective in the battle to protect global economies, with AI as the way forward. AI will not only play a huge role in understanding and mitigating inter-firm risk, it will also play an increasing role in some aspects of Operational Risk Management (ORM). ORM covers IT infrastructure and operations; cybersecurity; data protection; regulatory compliance; fraud; Anti Money Laundering  (AML), Counter Terrorist Financing (CTF), and sanctions compliance; conduct risk; outsourcing; geopolitical issues; and, physical attack. DataArt also expects to see the same growth in blockchain as firms wake up to the huge cost savings and security benefits from distributed ledger technology, and performance problems associated with original Blockchain technology start to be solved. ORM failures will increasingly cause more executives to lose their jobs as it takes on greater importance in the eyes of customers and regulators, and this will help drive the search for better (AI based) solutions to help model risk across the enterprise. New AI frameworks will be able to store, consume and use enormous amounts of data in a way that could only be conjectured five years ago. Thus, the volume, diversity and quality of data sources will play a big part in the success of AI solutions and business models. Cross-domain exchange of data will become the norm, and we will see strong growth in solutions focused on aggregating and exchanging user data. Finding the right balance between giving AI solutions all the data they need, and protecting that data will become increasingly important and increasingly complex. Here are DataArt’s technology predictions in full:Artificial Intelligence (AI) will be the industry game changer, but it will not come without problems as the current industry wide skills gap turns into a ‘war for talent’. In these systems, user data are stored in separated data protection layers e.g some data are held in an open form; some are held in an aggregated or masked state; while the most sensitive data are stored in a highly protected mode. Could reconstituting anonymised and encrypted data back to original data simply become a rather easy probability based problem for other AI solutions to crack?Another strong trend in 2018 will be the importance of Digitisation in achieving best possible User Experience (UX). If Uber can tell us all where the car is, who is driving it, how long it will take to arrive etc, people are right to expect to have the same level of visibility into their insurance claim. In 2018, we will also increasingly see blockchain as solution to cybersecurity and personal data protection through new confidential solutions based on zero-knowledge proofs, ring signatures, and new principles of data organisations.In summary, financial services and capital markets are about to go through a fintech driven revolution last seen with the adoption of computer and internet based automation from the 1980’s thru the 1990’s. Artificial Intelligence will be at the forefront of that revolution, but blockchain, IoT, and new data models – combined with vastly increased expectations of digitalisation from customers – will also play a big role. Early adopters will have an advantage in getting talent onboard before the biggest demands hit in mid 2018; but, even they will need to work hard to keep people as the slower moving ‘big brands’ try to lure people away. By the summer we should also see an end to scare-mongering about the threat to jobs from AI as the truth is revealed and it is seen to be a huge driver of technology, operations, and hi-tech engineering jobs.

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