Bad news for the 1%: new report says comprehensive report Since CitigroupFinance is set to bear the brunt of AI-driven travel.
AI will “profoundly change money,” the 124-page report claims in its introductory paragraph. Yes, it creates “new opportunities for growth and innovation, often improving our overall quality of life,” Citigroup says. But it also “destroys” and creates many “losers.”
Wall Street bankers may well be chief among them. Nearly seven in 10 banking jobs (67%) have a “higher potential” to be changed or even entirely outsourced by AI, Citigroup wrote, drawing on data from Accenture and the World Economic Forum. That’s the highest share of any job surveyed. Close behind are insurance, software, and financial markets. (Unsurprisingly, utilities and natural resources round out the bottom of the list.)
“Traditional AI adoption in financial services is broad, superficial, and inconsequential,” writes Shameek Kundu, chief strategy officer and head of financial services at AI observability platform TruEra, in the report.
The good news, however, is that the implementation of AI in the broad sense should benefit banks and financial institutions immensely. It may not even impact the total workforce, once the necessary AI-related hiring is factored in.
After all, AI is not yet sophisticated enough to operate autonomously. A “world driven by robots,” as Citigroup puts it, would still struggle to meet compliance rules, ensure data security, and uphold basic ethical principles because “AI models are known to hallucinate and create information that does not exist.” This is not a minor business risk.
AI could indeed generate $170 billion in additional profits for the global banking industry by 2028. And banks know this, even if they are hesitant to deploy the technology. Nearly all (93%) of financial institutions surveyed in a recent Citi client survey said that adopting AI would improve their profitability over the next five years, primarily because of its ability to automate routine tasks currently performed by human workers, such as data entry and dreaded Excel spreadsheets.
Despite the measurable benefits, which many other sectors have long enjoyed, Citigroup predicts that financial services will lag behind, slower to adopt AI than other sectors. Citigroup attributes this to the “highly regulated nature” of the sector and the lack of globally agreed rules. “Bankers may think they are leading the way,” Citigroup writes, “but many users are adopting the technology faster than banks or large companies,” a phenomenon it calls “the corona crowd.”