Banks getting prepared for the risks and rewards created by AI
Scottish banks are working to guard themselves against the risks posed by Artificial Intelligence (AI) - and take advantage of the opportunities, a finance technology expert has said.
The recent news that some of the most powerful AI models in development had ‘escaped’ from system safety constraints and carried out unauthorised hacks on independent companies has raised further questions over the risks posed by AI.
At the same time the UK’s AI Security Institute (AISI) announced it had found “unsanctioned agent behaviour” during cyber testing, including an incident where an AI agent created fake online identities to pressure a person to approve use of malicious code.
The threats posed by AI have never seemed more imminent. And with banking increasingly moving out of the high street and into the digital world, and AI linked to increasingly sophisticated fraud, it’s little wonder concerns over the security of online banking are also on the rise.
Companies in Scotland, like those around the world, are increasingly working with AI and looking at ways to guard against these risks - and develop the opportunities such technology presents.
FinTech Scotland, an organisation which drives innovation, collaboration, and growth within Scotland’s thriving fintech cluster, is one group supporting research and innovation into cutting-edge technologies that can make the best use of AI.
And while FinTech Scotland Chief Executive Aleks Tomczyk agrees there are significant risks over AI falling into the hands of ‘bad actors’, he also believes it can be used to guard against threats.
“In the same way this technology creates risks for bad actors - and they are out there - there also many many companies including the large financial services companies that provide services to the public that are working exceptionally hard to make sure they keep things secure,” he says.
“These tools can pose a risk but they can also be used to prevent any potential security breaches and improve security.”
Large Scottish and UK banks, like their global counterparts, are already using AI to help detect fraud, and in some cases to flag up any potential breach by other AI systems, as well as investing in training staff and educating customers about the risks posed and potential red flags to look out for.
“There’s a lot in the press about AI agents being created by the likes of Mythos and Anthropic, and they have been sharing their models with the financial services sector to allow them to prepare for potential risk that might pose,” said Aleks.
“Every substantial organisation in the sector has already reacted to the potential risk of that, because it’s in no one's interest for their to be security breaches - they work exceptionally hard to try and prevent those things and they are diverting resources to prevent those incidents occurring.
“Operational resilience is one of the key things that gets discussed at every board in every financial services company and all the companies that provide services
“The Bank of England and UK financial regulators are looking at how prepared businesses are. And they know that once a risk has been identified a huge amount of resources go into securing their services from it.”
Aleks has seen first hand much of the work being done in Scotland. And he said there were reasons to be hugely optimistic about AI, with Scottish companies already looking at using the technology to help people struggling to access banking or to manage their finances.
“There is great potential in the technologies we are seeing being adopted to help mitigate these kinds of risks for everyone, but in particular for generations that find it more difficult to access these services, from age or ability,” he said.
“People might find it difficult to use a tablet or get online, and we are not a million miles away from technology being able to make these things much more accessible, though things like. voice related interaction.
“Culturally, Scotland is a very inclusive and socially inclusive place by instinct. We always try and make sure that people aren’t left behind as much as possible. In our FinTech cluster we have a fantastic group of people building business to solve inclusivity problems.
“We’ve brought through programmes that address issues like fraud. AskSilver for example - a guy founded it after his father was defrauded out of a lot of money, so he went and built a technology that makes it easier to check up on these scams
“There’s a company in Glasgow called CienDos, who provide data on environmental impacts, while Moneymatics is focussed on financial education for immigrants to Scotland
“They are there and prospering. So while there are risks, there are plenty of reasons to be optimistic about what AI can do.”
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