Artificial Intelligence (AI) in finance

Considering the deep interconnections between financial firms, as well as the complexity and opacity around models and data, the use of AI raises concerns about introducing new or magnifying existing risks in financial markets. The increasing reliance on data, cloud services and third parties accompanying Generative AI (GenAI) could impact financial stability and have wider disruptive effects on the economy.

The OECD promotes a risk-aligned step-by-step implementation of GenAI models in the financial industry. This calls for quality data, sound governance, adequate privacy and strong ethics, as well as the need to monitor both AI concentration and application diversity.

AI can have many benefits, including better accessibility, timely information, cost-effective services, and improved user experiences. However, it also creates challenges like deepfakes, deceptive AI outputs, data protection, privacy concerns, and issues of bias and discrimination that can negatively impact financial consumers and retail investors. Generative AI systems entail risks concerning the quality and reliability of their results, made worse by users’ potential lack of awareness of the models' limitations.

The G20/OECD High-Level Principles on Financial Consumer Protection emphasise the need to address these risks, including misconduct from AI. Given AI’s global reach, international co-operation is essential for developing standards and sharing best practices.