And we’re kicking off the week with new analysis and opinions on fintech with banking, Artificial Intelligence, ESG, crypto, and more. Dive into the latest fintech insights and have a great start of the week!
CBDCs – miracle money or new world order? (Fintech Futures)
Central bank digital currencies (CBDCs) promise to revolutionise money, do away with cash, hamstring crime, boost financial inclusion and drive efficiencies. According to Juniper Research, the value of payments via CBDCs will reach $213 billion a year by 2030. That value currently stands at $100 million in 2023. That’s a 260,000% increase in seven years, to put that in some sort of perspective. This latest iteration of money, a system humans conjured up in around 3,000 BC in Sumer, according to Yuval Noah Harari (coins date back to around 650 to 600 BC), is currently being explored by nine out of ten central banks across the world in some form or another. For governments, the appeal is clear. No cash, no organised crime. But no cash also means no privacy. For governments, that may not be a big deal. For the rest of us, it should be a major concern. Read more
The European Union’s Artificial Intelligence Act, explained (World Economic Forum)
The European Union (EU) is considering a new legal framework that aims to significantly bolster regulations on the development and use of artificial intelligence. The proposed legislation, the Artificial Intelligence (AI) Act, focuses primarily on strengthening rules around data quality, transparency, human oversight and accountability. It also aims to address ethical questions and implementation challenges in various sectors ranging from healthcare and education to finance and energy. The cornerstone of the AI Act is a classification system that determines the level of risk an AI technology could pose to the health and safety or fundamental rights of a person. The framework includes four risk tiers: unacceptable, high, limited and minimal. Read more
How is financial services leveraging AI for compliance purposes? (Global Fintech)
In a time where AI is revolutionising industry after industry, the increasing need and desire to automate compliance is becoming ever more sought after. The role of AI in financial services is rapidly increasing, with the introduction of ChatGPT causing deep ripples in the financial industry. With compliance being a permanent challenge for companies to maintain, the ability to automate this challenge provides significant upsides for businesses. “We’re seeing AI play a fundamental role in enabling financial services companies to supervise their business communications,” said Stacey English, director of regulatory intelligence at Theta Lake. She highlighted that with the modern workplace now powered by modern unified collaborations like Zoom and Teams, many regulated organisations are facing a huge challenge in capturing and supervising these complex multimodal capabilities. Read more
Banks must seize control of their dangerous data silos (Fintech Magazine)
Rob Houghton, founder and CTO of Insightful Technology, says banks face a serious compliance and cost challenge with data silos. It’s time they acted. Remaining compliant in today’s financial services industries requires a comprehensive surveillance function. Every call, message and communication between employees, customers and trading partners must be captured, stored and monitored to illustrate compliance. As regulatory requirements have become more demanding, many banks have sought to plug gaps in their coverage by adding new point solutions to their legacy technology. Each time a regulator makes a new request, more software has been stitched into an increasingly large patchwork quilt of systems. Read more
Why Generative AI is Banking’s Solution to Big Tech Challenge (The Fintech Times)
Don’t let the Chat GPT hype put you off: large language models (LLMs) and generative artificial intelligence (AI) are the secret weapons banking needs to face down Big Tech’s threat. That’s the view of fintech entrepreneur Leon Gauhman, co-founder and CPO/CSO at digital product consultancy Elsewhen, which boasts clients including Spotify, Google, Microsoft and Mastercard. With neobanks apps outperforming those of legacy banks and Apple and Google pulling ahead in the race for digital wallet dominance, Gauham argues that embracing LLM will allow banking incumbents to reset the scales in their favour. Read more
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