AI set to drive $164 billion increase in banking revenue by end of 2024

According to Statista, artificial intelligence (AI) will inject $164 billion into the banking sector by the end of the year, with North American countries set to profit the most. 

The region’s financial sector is expected to earn roughly $50 billion from AI, closely followed by Asia Pacific at $49 billion in 2024.

AI-driven banking revenue is set to rise by almost $20 billion

The banking industry could see an $18 billion revenue rise this year compared to 2023, just from artificial intelligence. Statista shows financial institutions could earn $164 billion in revenue in 2024 from AI input. 

North America’s finance sector is projected to earn the most, adding $50 billion to the AI banking revenue tally. Asia Pacific follows at $49 billion. Coming in third in AI revenue gains is Europe, projected to generate $47 billion, followed by $10 billion for the Middle East and Africa and $8 billion for South America.

The projected rise in revenue could be attributed to several financial institutions adopting AI in 2024 to automate routine tasks, risk management, and even fraud detection. According to a survey by Nvidia, 91% of financial services companies were already considering or had already implemented AI to improve operational efficiency by February 2024.

Financial institutions like Wells Fargo, BlackRock, UBS, and Deutsche Bank are already using AI tools to improve customer experience. These four have all partnered with Sqreem to conduct consumer analysis and have AI-analytic tools to predict future consumer patterns and needs. Similarly, S&P Global uses AI-based Kensho to find correlations in stock and currency price movements, while Bank of America uses Glass software to personalize and predict customers’ wants.

AI was banks’ priority in digital transformation plans

A Publicis Sapient survey revealed that the number of “transformation leaders” among banks had been slashed by half, plummeting to only 11% from 22% in the previous study. 

The survey further showed that multiple banks had included AI in their digital transformation goals for 2024. However, some were forced to forfeit their AI plans due to financial inadequacies and fears over possible regulatory changes.

Dave Murphy, financial services lead at Publicis Sapient, commented on AI-fueled digital transformation plans, “AI, machine learning, and generative AI are both the focus and the fuel of banks’ digital transformation efforts. The biggest question for executives isn’t about the potential of these technologies; it’s how best to move from experimenting with use cases in pockets of the business to implementing at scale across the enterprise.”