THREE out of four senior banking leaders in Asia-Pacific said artificial intelligence (AI) technologies used by the industry must be tailored for financial services to ensure compliance with stringent regulations.
A survey by global analytics software provider FICO showed that 77% of industry leaders in the region believe it is “extremely important” that AI tools used in banking are built specifically for financial services, with only 23% saying this specialization is only “somewhat important.”
The poll was conducted in August during FICO’s Banking Leaders Forum in Bali and included responses from 51 senior executives and C-suite leaders from leading Asia-Pacific banks.
“Senior banking leaders across Asia-Pacific have made clear that general-purpose artificial intelligence is insufficient for financial services. Three-quarters believe AI tools used in banking must be built specifically for financial services, not adapted from consumer applications,” it said.
“Financial institutions operate under regulatory scrutiny that most consumer technology companies don’t face,” said Dattu Kompella, Asia-Pacific managing director for FICO. “Banks need AI models that are explainable, auditable and designed from the ground up for compliance. Off-the-shelf consumer AI doesn’t meet that bar.”
The top concern about AI adoption was data privacy and security, cited by 42% of respondents.
Meanwhile, 21% identified regulatory and compliance risk as their biggest worry, and 21% flagged model transparency and explainability to be critical.
Only 16% cited computing cost or infrastructure as a barrier, FICO added.
“The barriers aren’t about capability or price. Banks are concerned about trust, auditability and the ability to explain decisions to regulators. That’s exactly why purpose-built AI for financial services matters. It’s designed with those constraints in mind from day one,” Mr. Kompella said.
According to the poll, 46% of banking leaders in the region expect task-specific AI models to be deployed in their fraud, compliance, and underwriting operations within the next one to two years, while 26% also expect adoption within three to five years.
Meanwhile, 26% said they have already deployed these models.
For top use cases, 64% of respondents said they see credit underwriting and lending decisions as the back-office process that would benefit most from purpose-built AI.
It added that 18% mentioned regulatory compliance monitoring, 10% customer due diligence, and 8% internal policy and business operations review.
More than 60% of banking leaders in the region also identified fraud and scam detection as the area where generative AI could most improve operations in the next 12 months, while 21% cited underwriting decisions, 15% mentioned customer-facing digital banking services, and 3% said it could help in regulatory compliance monitoring.
“This focus reflects both the urgency of the scam epidemic across the region and the potential for AI-powered behavioral analytics to detect patterns human analysts might miss,” FICO said.
“With 77% of banking leaders calling purpose-built AI ‘extremely important’ and 46% expecting task-specific models in fraud, compliance and underwriting within two years, the focus is moving from whether to adopt to how. Banks will need to invest in domain-specific models designed for financial services, supported by cleaner data infrastructure, faster integration with legacy systems, and clearer governance frameworks.” — Bettina V. Roc