Financial institutions have a wealth of data at their disposal, but most of this has been organically collected over years and across various departments. This has led to siloed datasets that firms are unable to make the full use of.
As artificial intelligence (AI) becomes more intertwined with the daily operations of financial institutions, firms are going to fix their data so the technology can maximise its potential. In an attempt to clean their data and build new operating models, firms have spent millions. However, it has not been the perfect solution. Alpesh Doshi, managing partner at Redcliffe Capital, stated that not much has changed in the past 15 years.
FinTech Global recently spoke to Alpesh Doshi, managing partner at Redcliffe Capital, to get his thoughts on the importance of data management for AI in financial services.
During the discussion, Doshi was posed the question; what impact has AI had on data governance frameworks and practices within financial institutions. Simply put he said, “Very little as far as i can tell.”
He continued, “The standard practice around data governance frameworks hasn’t really changed in 10/15 years. The idea of data governance is generally immature in most firms. They haven’t really fixed data governance and if they have it’s in spots. But across most firms, data governance is seen as a cost rather than a benefit, even though we know the lack of data and data quality has caused a lot of issues in firms.
“Firms have not taken data governance very seriously because they don’t understand it. They ask ‘what’s this for and why is this a benefit to me’, because their concept is quite abstract and the business benefits are not proven too well.”
While he was critical of current efforts, Doshi was very optimistic about the potential generative AI and how it can make real change. “The Gen AI promise will absolutely change this. It will absolutely change how data quality and data governance works and the data governance frameworks will completely transform through Gen AI.”
He continued by stating generative AI will help collate data and documents and demonstrate value relatively quickly. The ability to solve data governance and utilise the capabilities of generative AI will be a game changer for financial institutions.
Watch the full interview for more of Doshi’s insights.
Keep up with all the latest FinTech news here.
Copyright © 2024 FinTech Global
