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Generative AI is playing a pivotal role in personalizing financial advice products and services: Gautam Samanta, President and Global Leader – Banking and Financial Services at Coforge

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In the dynamic landscape of the Banking and Financial Services (BFS) sector, the convergence of cutting-edge technologies is reshaping industry paradigms at an unprecedented pace. To better understand the broad technology trends in this sector and gauge the impact of emerging technologies such as Generative AI, we spoke with Gautam Samanta, President and Global Leader – Banking and Financial Services at Coforge

Some edited excerpts from the interview:

What are the key trends in the BFS sector?

The BFS sector is witnessing a rapid evolution fueled by technological advancements. Key trends such as the rise of generative AI are reshaping the industry landscape, with a strong emphasis on enhancing customer experiences, improving operational efficiency, and mitigating risks through innovative solutions. Generative AI (Gen AI) is now transitioning from mere discussion to practical implementation, marking a crucial phase in its development. Additionally, it’s essential to actualize the digital potential into tangible benefits, which I refer to as the “Digital dividend.” People expect real value from these digital advancements. There have also been significant investments in digital enablement for a while now, with a newfound focus on capturing the digital dividend. This includes enhancing customer stickiness through product offerings, quicker time to market, and internal optimization.

There’s also a heightened awareness of risks due to increased exposure from technology enablement, such as Gen AI and open banking APIs, leading to a significant rise in vulnerabilities. Mitigating these risks, including unforeseen ones, has become a priority. Additionally, there’s growing momentum in embracing intelligent automation to drive cost efficiencies. In regions like the UK and Europe, embracing open finance is fostering product innovation and ecosystem delivery. These are some of the key trends in the digital enablement landscape.

How do you see the role of generative AI in the BFSI sector?

Generative AI is playing a pivotal role in personalizing financial advice products and services for clients. By leveraging generative AI capabilities, BFS firms can tailor recommendations and reports based on individual client preferences and market data. Additionally, Voice Assistants powered by generative AI technology enable seamless interactions, providing customers with a more intuitive and personalized experience. Generative AI is also instrumental in enhancing fraud detection and risk management processes in BFS organizations. By leveraging advanced algorithms and data analytics, generative AI can proactively identify potential fraudulent activities and mitigate risks effectively. This technology enables BFS firms to strengthen their security measures and safeguard against financial threats, ultimately enhancing trust and reliability in the sector

Has automation truly elevated itself in terms of addressing complex use cases or solving them? Do you observe this trend occurring in the banking and financial services industry as well?

Absolutely. As I mentioned earlier, there is still a focus on cost reduction. From an overall tech spending perspective, banks may increase their investment slightly compared to last year. However, if they want to invest in Gen AI, and ensure continuous digital transformation, they need to do much more.

Initially, automation was approached tactically, addressing inefficient processes to gain some benefits. However, there’s a limit to how much improvement you can achieve with this approach, especially if the underlying processes remain inefficient. Now, we see a shift towards a more holistic approach, examining processes end-to-end to identify inefficiencies and conduct comprehensive automation exercises, including intelligent automation. This approach can yield more sustainable benefits in the long term, especially considering the evolving technology landscape. Tactical automation on inefficient processes may lose its value once other changes are made. This broader approach to automation is becoming more prevalent now.

Which areas in your view are huge growth areas for you?

We believe we are in a fairly strong position to leverage our capabilities across the sector — whether it’s retail, commercial banking, asset and wealth management, capital markets, or even central banking, I think the key factor is that most of these areas are leveraging new technology to deliver value. Our core competency lies in rapidly scaling up newer technology, in which we have proven strengths. That has been one of our secrets to the tremendous growth we’ve seen in our BFS business over the last five years, which continues to be our focus so that we can be proactive, flexible, and focused in creating that kind of skill set. Additionally, I would highlight data analytics and cloud services because they are key enablers for AI journeys and risk management. These areas also present great opportunities for growth.

How is the Indian market as compared to other global markets?

It is not very different. I think the gap has narrowed significantly. Currently, if I look at it, the kind of technology they are using and the platforms they are working on are fairly similar in many respects. Actually, the Indian financial services sector almost skipped a step because a lot of investment in technology happened in developed markets like 2 or 3 decades ago. In many cases, Indian players are able to stay on par and adopt the latest technologies. So, looking at the current trends, there is not much divergence anymore.

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