In the future, artificial intelligence will, among many other things, allow to develop helpful customer products for unbanked segments of the population. “Artificial intelligence and financial technologies create opportunities for the democratization of finance,” said Álvaro Martín, Head Economist of Digital Regulation and Trends at BBVA Research, during the meeting of the Institute of International Finance (IIF), held in Brussels. In his opinion, “artificial intelligence, big data and cloud computing will boost financial inclusion”.
Álvaro Martín took part this Wednesday in a panel on ‘Data-Driven Finance and AI’, moderated by Martin Arnold, Banking Editor, Financial Times, which also consisted of Ronit Ghose, global sector head for banks research. Citi Research; and Michael Natusch, Global Head of AI, Group Digital Team, Prudential Plc. BBVA’s Group Executive Chairman, Francisco González, and Executive Member of the Board José Manuel González-Páramo, also participated in other panels held during this first day of the event.
During the debate, Álvaro Martín also made reference to the access of tech giants and new fintech startups to financial data through aggregators and APIs, a novelty that has increased the need for banks to quickly adopt artificial intelligence, he warned. BBVA Research’s head economist considers that the access to data by companies that handle data massively should be symmetrical, to ensure a level-playing field. “If you think about how regulators approach data, for example, there is a regulation for the financial sector and another one for the remaining sectors,” he explained. “There’s an asymmetry.” This, in his opinion, detracts from the financial industry’s overall competitiveness. “It is much easier for the GAFA (Google, Apple, Facebook, Amazon) to access banking data than the other way around.”
If you think about how regulators approach data, for example, there is a regulation for the financial sector and another one for the remaining sectors
Regarding the main hurdles facing banks when adopting innovative technologies, Álvaro Martín focused on three: Knowledge gaps among employees regarding these technologies; legacy processes and data architecture, which require new governance models to squeeze out the value from the available datasets; and regulatory and competitive pressure.
Álvaro Martín, Head Economist of Digital Regulation and Trends de BBVA Research, at the IIF panel. - BBVA
The experts debated on how regulators and supervisors should approach artificial intelligence (AI). According to BBVA Research’s Head Economist of Digital Regulation and Trends at BBVA Research, the current regulatory framework already establishes some general principles such as privacy protection, non-discrimination or consumer protection, which all technologies are required to comply with.
Finally, he stressed the importance of international cooperation between the public and private sectors, to understand the impact of these new technologies, minimize risks and create a level playing field for all competitors.