Financial institutions often grapple with the decision of buy or build new technology, however that question may evolve — or rather dissolve — with the advancement of AI.
When weighing enterprise solutions through AI, “why wouldn’t you internalize and bring capability in-house and have something proprietary,” Kara Byun, head of fintech, HSBC Asset Management said at the Fintech Connect North America conference on Tuesday.
AI will change the “buy versus build decision” for FIs by making it easier for companies to bring capabilities in house, HSBC Asset Management Head of Fintech Kara Byun said at Fintech Connect #fintechconnect
— Bank Automation News (@BankAutomation) June 27, 2023
The question is: Is there a need for third parties, Byun said. “Maybe you can [build] in-house perfectly on your own, with your own controls.”
“That’s an existential question for the existence of a lot of fintech companies,” she said.
For example, if a fintech has one specific area of expertise but is difficult to scale, an FI could look to AI for solutions, she added.
“Do companies need to exist when you have so many tools that are coming out now that allow incumbents or bigger companies to bring that capability in-house?” she asked.
AI at HSBC
HSBC has implemented AI, specifically with its latest use of Google’s AI-powered anti-money laundering tool, according to a Google release. Since using the tech, the London-based bank has eliminated 60% of false positive alerts.
The $3 trillion bank upped its tech spend 19% year over year to $6.1 billion in the first quarter as it prioritized workflow efficiency and customer experience.
