Artificial intelligence as both an opportunity and a risk for the financial sector

Our survey shows that executives in the financial sector look to the future with confidence. They have relatively more confidence in their company's revenue growth than their peers in other sectors. At the same time, they are highly aware of the risks that could affect business operations, with cyber risks being their greatest concern. The financial sector has become increasingly digital and relies heavily on data and technology, making cyberattacks a potential threat to business continuity. For CEOs in financial services, digital security is therefore not a technical detail, but a core part of their strategic responsibility.

Financial sector steps up cybersecurity

Cybersecurity and resilience therefore top the risk agenda in the financial sector. ‘The availability of systems at banks and insurers is crucial,’ says PwC partner and FS lead Jeroen de Jonge. ‘If customers want to pay and the terminal doesn’t work, or they cannot access their bank account, it creates a lot of unrest. The financial sector ultimately runs on trust. That is why the sector is investing heavily in cybersecurity.’

Dependence on US data providers

De Jonge: ‘In the financial sector, there is also awareness of the dependence on data providers and hyperscalers from the United States. And how vulnerable are you if a conflict leads to a supplier switching something off? These are difficult issues to resolve, but ones you still need to think hard about.’

‘You can, for example, examine where dependencies lie and explore whether they can be spread further. However, there are few serious alternatives available within Europe. And if you choose those alternatives, it often comes at the expense of security. That is the major dilemma the sector is facing. In the meantime, it is advisable for financial institutions to prepare for "what if" scenarios. You can also look at lessons from other countries. For example, what can you learn from banks and insurers in Ukraine and what they have done since the Russian invasion?’

Working more efficiently is a necessity for the financial sector

De Jonge: ‘Dutch banks, insurers and pension funds have significantly strengthened their resilience in recent years through higher capital ratios and improved risk management. The next phase focuses on improving returns and efficiency. AI can play an important role in this efficiency drive. The financial sector inherently has many tasks and processes that can be further automated with AI. This expectation is also reflected in our CEO Survey results.’  

AI foundation needs further strengthening

De Jonge: ‘In daily practice, I also see that the financial sector is exploring the possibilities of deploying AI across various processes within banks and insurers. However, it is essential that the AI foundation is in place. There are still important steps to be taken here, as our survey also shows. Ultimately, I expect that the speed at which financial institutions can implement AI properly, while maintaining market trust, will determine their success.’