Fifty One Degrees, an AI consultant, has released a research study revealing almost 85% of tasks and activities in financial services firms would benefit from generative AI technology.

The study analysed 311 tasks and activities spanning fourteen functions in banks, insurance companies and financial services firms, and considered which AI technologies would benefit each task and an expectation of how much benefit would be created.

GenAI is by far the most impactful AI technology for financial services today

GenAI Assistants built to support team members with one or more specific functions will benefit three-quarters of tasks performed by financial services and insurance firms, the study found.

GenAI Assistants are trained on specific policies, procedures and regulations. They are most impactful for functions where large volumes of natural language information are processed, such as compliance, legal, risk management and underwriting. In some cases, AI assistants will make employees more efficient, whereas in other places they will automate some of the workflows altogether.

The study found that other AI tools, which are also often powered by generative AI and large language models will be the next most impactful, creating gains in 39% of activities. Examples of other AI tools include AI-powered training, AI-based legal tools, AI finance tools, and many more.

Policy, data, technology or customer-orientated teams will experience the greatest impact

The analysis shows that analytics & data science, technology, customer services and underwriting functions can both increase efficiency and the quality of work delivered through the use of GenAI. Other functions such as compliance, enterprise risk and legal will benefit significantly from efficiency gains, but the quality of work is unlikely to increase at the same rate.

Economic impact of GenAI in banking and financial services

Recent research estimates that generative AI will drive US$2.6 trillion to US$4.4 trillion annually in value for global companies. Within financial services and insurance, that figure is US$200 billion to US$340 billion, which is equivalent to 9 to 15 per cent of operating profits.

The UK financial services and insurance industries produce £278bn of economic output. A 15% boost would generate a staggering £41.7bn of additional economic output. Further, the UK financial services industry equates to 8.3% of the entire UK economy and 2.5 million people are employed in the sector. Therefore, any gains made by financial institutions would have far-reaching impacts across the wider UK economy.

Commenting on the study, co-founder and CEO of Fifty One Degrees, Nick Harding said: “The UK financial services industry is a powerhouse that fuels the local economy by servicing consumers and businesses, but is also the UK’s biggest export.

“Enabling this industry, which is so critical to our collective success, to remain at the forefront of technology is something we’re passionate about. Assertively adopting generative AI will enable UK financial services to grow further, enabling this vital sector to remain a global leader.

“And this is just the beginning. This study represents the generative AI technology and tools that are available today. What we’ve experienced is rapid development and evolution of the technology and its capabilities, meaning the opportunity for businesses to benefit will only increase.”