54% of banks are planning to leverage generative artificial intelligence (AI) for the shift to instant payments and other payments modernisation projects, while four in ten (42%) are actively considering the possibility.
That is according to new research from RedCompass Labs. The report, AI in payments: The future of payments modernization?, includes findings from a survey of 200 senior payments professionals at EU and US banks which examined their views on generative AI, their expertise, and their approach to AI in payments modernisation.
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Every bank in Europe is currently readying its infrastructure to meet the SEPA Instant Payment Regulations deadlines, which many think are unrealistic. Meanwhile, banks in the US are trying to meet growing momentum for instant payments, while Canadian banks are preparing for the launch of their instant payments scheme as early as 2026.
91% of banks rank payments modernisation as important
However, these projects are draining time and budgets with banks spending upwards of $100m on multi-year payments modernisation projects and hiring teams of up to 50+ business analysts to deliver them. Two-thirds of a bank’s time and investment on these projects is directed towards project analysis, testing and business/system analysis, areas ripe for AI disruption.
The research also reveals that AI is already having an impact on headcount, with 38% of banks believing AI can already reduce the number of business analysts needed for these projects. An additional 27% anticipate this reduction will occur within the next 1-2 years and 28% foresee it happening within 3-4 years.
Despite this, banks still believe human oversight remains essential. They believe in a balanced approach to human and AI collaboration, which is slightly tipped towards AI, with the minimum level consisting of 49% human and 51% AI involvement. Human involvement is most important for strategic tasks (37%), improving internal processes (34%) and customer experience (29%).
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