According to Lloyds Bank, the adoption of artificial intelligence (AI) has doubled among financial institutions over the past year.
AI was the prominent topic in Lloyds Bank’s ninth annual Financial Institutions Sentiment Survey, which found almost two-thirds (63%) of financial institutions are investing in AI, up from one-third (32%) in 2023.
The survey asked over 100 senior decision-makers at banks, wealth and asset managers, insurers and financial sponsors, about the emerging technology. Notably, 81% of financial institutions viewed it as a business opportunity, a significant rise from 56% in 2023.
“As a result, many institutions are already experiencing the benefits, such as enhanced productivity, deeper customer insights, and a stronger competitive edge. While the full impact across all business areas is yet to be realised, this will evolve as institutions continue to innovate, test and learn.”
When asked about the benefits of using AI, respondents named three key areas. One was improved productivity, with 62% see it as an opportunity while 32% are already seeing the benefit.
Another was a competitive advantage, with 61% agreeing it’s an opportunity while 22% already benefiting from it. Finally, some respondents noted greater insight on customers as 69% see it as an opportunity while 18% are already seeing the benefit.
A major trend this year has been banks and companies creating their own AI departments attempting to utilise the technology to its maximum potential. Spanish bank BBVA followed through on its pledge to grow its AI workforce in August by more than doubling its headcount.
Initiatives like this were highlighted in Lloyds’ report. The bank found that nearly half (46%) of financial institutions have established dedicated teams to explore AI use cases, while two-fifths (39%) have partnered with firms possessing AI capabilities. Additionally, 15% have already collaborated with firms specialising in AI.
Rohit Dhawan, Director of AI and Advanced Analytics at Lloyds Banking Group, said: “AI is rapidly reshaping the financial landscape, and what we’re seeing is just the beginning. Growing investments from financial institutions and increasing partnerships in AI demonstrate a clear commitment to leveraging this technology.
“From automating complex processes to unlocking insights that improve decision-making, AI is enabling institutions to reimagine what’s possible. We are witnessing an exciting period of transformation, and it’s inspiring to consider the advancements that lie ahead for the sector.”
