Citigroup Inc. predicts that artificial intelligence will likely replace more jobs in banking than in any other industry. The technology is set to change how consumer finance works. It will also help workers be more efficient at their jobs.
Citigroup’s new report on AI, released Wednesday, shows that about 54 percent of jobs in banking could be automated. Another 12 percent of jobs in the industry could be upgraded with AI technology.
Over the past year, the world’s largest banks have gradually begun using AI more often, driven by its potential to increase productivity and reduce costs. Citigroup’s latest report reveals that AI could bring an extra $170 billion to the banking industry by 2028.
Citigroup to equip 40,000 coders to experiment with AI
Citigroup plans to enable its 40,000 coders to experiment with various AI technologies. The company has already used generative AI, which can create text from simple prompts to quickly review hundreds of pages of regulatory proposals.
“Our focus now is [on] taking it from the lab to the factory floor,” said Citigroup’s CEO, Jane Fraser, on Thursday at the company’s digital money symposium. She added that the bank is also looking into using AI to provide personalized investment advice for wealthy clients and enhance its cybersecurity.
Citigroup reports that 54% of jobs across the banking sector are at a high risk of automation. The group’s latest analysis highlights that AI is expected to displace more jobs in the banking industry than in any other sector. World Wide Worx CEO Arthur Goldstuck unpacks this.… pic.twitter.com/joo0KZzd3n
— Newzroom Afrika (@Newzroom405) June 21, 2024
JPMorgan Chase & Co. is hiring AI experts, and CEO Jamie Dimon believes this technology could shorten the workweek to just 3.5 days. Deutsche Bank AG is using AI to analyze portfolios of wealthy clients, while ING Group employs AI to identify potential defaulters.
Generative AI “has the potential to revolutionize the banking industry and improve profitability,” said David Griffiths, Citigroup’s chief technology officer, in a statement with the new report. “At Citi, we’re focused on implementing AI in a safe and responsible way to amplify the power of Citi and our people.”
Overall number of bank employees might not be reduced
Citigroup stated that even if AI replaces some jobs in the banking industry, it might not reduce the overall number of employees. Financial firms will probably need to hire many AI managers and compliance officers to ensure regulations are followed while AI technology is being used.
Additionally, new technologies don’t always result in job cuts. For example, Citigroup noted the number of human tellers increased from the 1970s to the mid-2000s even after automated teller machines (ATMs) were introduced.
Generative AI is widely used in customer service and support by both financial technology startups and major banks. For instance, Revolut Ltd. already uses AI to handle over 30 percent of its customer chats.
“That’s one area where the sky is the limit,” said Francesca Carlesi, head of Revolut’s UK operations. “I’m in no doubt in a couple years from now we might have 80% of the customer interaction [done through AI]. They are very efficiently managed through genAI.”