Banks are investing more in technology in order to keep pace with new challenges, including how to verify customers in the wake of the massive Equifax hack. More than 11,000 people in payments, fintech and financial services will gather in Las Vegas this week for the Money 20/20 conference to discuss emerging technologies like biometric authentication, artificial intelligence (AI), and others.
While companies like JPMorgan are early investors in emerging technology like AI – the lender commits one-third of its technology budget to new initiatives – a new report by VMware finds that other banks may not be far behind, many aiming to have commercial implementations of emerging technologies over the next five years.
In results from a survey released today, VMware finds that more than 50 percent of banks with $100 billion or more in assets expect to have commercial implementations of emerging technologies like artificial intelligence and augmented reality in the next five years.
Sixty-seven percent of respondents from banks with $100 billion of assets or more are currently implementing blockchain technology.
Integrating new technologies into existing platforms is a challenge for banks, with 46 percent of respondents reporting that legacy infrastructure has an impact on their ability to launch new products. Of these institutions, 52 percent said they are engaging in data center modernization, and 48 percent in cloud computing projects to help address the problems brought about by legacy infrastructure.
Seventy-three percent of banks that are considering or implementing security upgrades, data center modernization programs, cloud deployments and fintech innovations expect the initiatives to have a moderate to high impact over the next 12 months.
Savings from retiring legacy infrastructure could help institutions invest in newer technologies, as JPMorgan has done.
Eighty-one percent of respondents from banks with $100 billion of assets or more are investing in cloud; with 68 percent of respondents from banks with $15 billion to $100 billion of assets invest in cloud, respectively.