New use cases for generative AI continue to surface, and as financial institutions explore the technology, they must consider compliance. 

Uses for generative AI in the finance industry include linking institutions quickly, working as a personal wealth management tool and teaching financial literacy, according to Mastercard’s “Commerce in the age of generative AI” report, released Aug. 7, and produced by Mastercard Foundry.

As use cases evolve, investment and innovation in generative AI continue to scale. The report notes: 

• The global AI market is expected to reach $422 billion by 2028, projecting a compound annual growth rate of 39.4%, according to Zion Market Research; and 
• In 2021, AI-related patents increased to 140,000, up from 10,000 in 2017, according to Our World in Data. 

Use cases continue to emerge in enterprise, small business, travel and retail, according to Mastercard’s report. 

Approaching gen AI

Identifying use cases is one thing, but implementing the technology requires more strategy — especially in finance, Caroline Louveaux, chief privacy and data responsibility officer at Mastercard, told Bank Automation News.  

“AI and generative AI is built on vast amounts of data — and financial data is particularly rich,” she said. “AI can be used in ways that can reveal sensitive personal information, that may amplify existing bias or otherwise impact people’s privacy and other human rights.” 

 Mastercard has policies and an AI governance framework in place, Louveaux said. “Anytime our teams want to use AI, the use case goes through our AI governance program to ensure it is aligned with Mastercard’s corporate strategy and our data responsibility principles.” 

Financial institutions can do the same Louveaux said. Frameworks could include a best practices guide, governance structure and management oversight. 

FIs get on board

Banks are starting to explore generative AI. 

One example is the $626 million Danske Bank, based in Copenhagen, Denmark. The bank selected Indian IT-firm Infosys to upgrade its digital operations since Infosys has generative AI offerings within its platform.   

Another example is the $861 billion NatWest, based in London. The FI is embedding IBM’s watsonx into its chatbot experience to accelerate generative AI workflows.  

Regulating AI

The Mastercard report calls for AI standards across all industries to address the following: 

• Security and privacy 
• Transparency and control 
• Accountability 
• Inclusion 
• Integrity 
• Innovation 
• Social impact 

But FIs “do not have to start from scratch” when implementing generative AI, Louveaux said. Existing policies can be applied. “This is a fast-moving space, and we need to double down on a dialogue between the public and private sectors to get this right,” she said.  

“Our team of data and legal experts are engaging directly with policymakers to make sure these rules are principles-based, consistent and fit for purpose, Louveaux added. “And we are constantly enhancing our controls and governance to ensure our uses of AI and Gen AI comply with all laws and align with our data responsibility principles at all times.”