The year is 2030. You’re in a business school lecture hall, where just a handful of students are attending a finance class. The dismal turnout has nothing to with professorial style, school ranking or subject matter. Students simply aren’t enrolled, because there are no jobs out there for finance majors.
Today, finance, accounting, management and economics are among universities’ most popular subjects worldwide, particularly at graduate level, due to high employ-ability. But that’s changing.
According to consulting firm Opimas, in years to come it will become harder and harder for universities to sell their business-related degrees. Research shows that 230,000 jobs in the sector could disappear by 2025, filled by “artificial intelligence agents”.
Are robo-advisers the future of finance?
A new generation of AI Investments in automated portfolios rose 210% between 2014 and 2015, according to the research firm Aite Group. Robots have already taken over Wall Street, as hundreds of financial analysts are being replaced with software or robo-advisors.
In the US, claims a 2013 paper by two Oxford academics, 47 per cent percent of jobs are at “high risk” of being automated within the next 20 years – 54 per cent of lost jobs will be in finance.
This is not just an American phenomenon. Indian banks, too, have reported a 7 per cent decline in head count for two quarters in a row due to the introduction of robots in the workplace.
Perhaps this is unsurprising. After all, the banking and finance industry is principally built on processing information, and some of its key operations, like passbook updating or cash deposit, are already highly digitised.
A man leaves an Axis Bank automated teller machine (ATM) in New Delhi, India. Adnan Abidi/Reuters. Now, banks and financial institutions are rapidly adopting a new generation of Artificial Intelligence-enabled technology (AI) to automate financial tasks usually carried out by humans, like operations, wealth management, algorithmic trading and risk management.
For instance, JP Morgan’s Contract Intelligence, or COIN, programme, which runs on a machine learning system, helped the bank shorten the time it takes to review loan documents and decrease the number of loan-servicing mistakes.
Such is the growing dominance of AI in the banking sector that, Accenture predicts, within the next three years it will become the primary way banks interact with their customers. AI would enable more simple user interfaces, their 2017 report notes, which would help banks create a more human-like customer experience.
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