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The Monetary Authority of Singapore (MAS) is working with a group of industry stakeholders to develop a guide that will promote the responsible and ethical use of AI and data analytics by financial institutions (FIs).
The group, dubbed the Fairness, Ethics, Accountability, and Transparency (FEAT) Committee, is made up of thought leaders and practitioners in data analytics in the financial sector. Its 10 members include David Hardoon, MAS’ chief data officer, Hsieh Fu Hua, cofounder and advisor at PrimePartners, and Paul Cobban, chief data and transformation officer at DBS. MAS will co-create the guide with the FEAT Committee, and expects to have it finalized by the end of this year.
As more FIs implement AI in their businesses, such guidelines are becoming increasingly necessary. FIs are using AI and data analytics in areas like fraud prevention, customer service, and to improve cross-channel engagement. However, this emerging technology is raising some concerns with regulators, as it is often difficult to comprehend why it has come to a certain conclusion. This is particularly an issue when wrong decisions are made — for instance, if it makes a mistake in flagging fraudulent behavior. As a result, it’s growing important for regulators explore the use of AI tools, and establish guidelines for their safe implementation.
MAS’ approach is likely a good one, and other countries may want to take note.Getting industry players from a broad range of backgrounds to work on these guidelines, while focusing on areas including fairness and ethics, will likely help MAS achieve good insight into the use cases and issues related to AI.
Additionally, the regulator is looking for feedback on the proposed guidelines in Q2 2018, which will further help the committee to ensure that the guidelines will be useful and relevant in the future. Meanwhile, regulators globally would do well to take their own steps to better understand AI techniques, as the space continues to grow. If MAS’ approach is successful, we may see other countries taking up similar efforts.
Business Insider Intelligence, Business Insider’s premium research service, has written a detailed report on AI in banking and payments that cuts through the hype to offer an overview of different types of AI, and where they have potential applications within the finance industry. In full, this report:
- Offers an overview of different types of AI and their applications in payments and banking.
- Highlights which of these applications are most mature.
- Offers examples where FIs and payments firms are already using the technology.
- Provides descriptions of vendors of different AI-based solutions that FIs may want to consider using.
- Gives recommendations of how FIs and payments firms should approach using the technology.
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