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NZ's financial sector primed for AI, research finds

New Zealand's financial sector is primed for artificial intelligence, according to new national research.

The AI Forum of New Zealand (part of the NZTech ecosystem) research study says the country's financial and insurance sectors are better prepared to incorporate and reap rewards from AI implementation than other industries.

According to Emma Naji, AI Forum executor director, the report identifies New Zealand urgently needs to increase its focus on the core foundations needed to operate in an AI enabled future.

This is especially important relating to investment, skills and talent, research, trusted data, ethics and regulation, she says.

"The report shows how AI-driven solutions can be used to improve New Zealand's wellbeing, productivity and sustainability," says Naji.
"Unsurprisingly, financial institutions have been quick to capitalise on the opportunities and new techniques that AI offers."

Naji says outside the tech industry, the financial service sectors are a leading early adopter of AI in terms of spending.

"Financial insurance services and retail were among the first industries worldwide to adopt AI systems. Industry analyst IDC expects these industries to continue representing more than a quarter of AI spending," she explains.

As of April 2018, there were 26 registered banks in New Zealand, the report says. The overall Kiwi financial services sector, including insurance, contributed $13.4 billion to GDP in the year ending March 2017.

The World Bank has said New Zealand had relatively high uptake of digital banking, with 83% of Kiwi adults using electronic payment methods, making New Zealand the fourth most intensive electronic payment user out of 164 countries.

"Tech is the fastest growing and third largest export sector in New Zealand, and the financial services industry is a major employer and economic driver in New Zealand. With an estimated 70,900 people employed in the sector in 2017, but with an expected increase to 76,000 by 2020," Naji says.

The report says banks and insurance providers are using AI to enable next-generation customer experience.

"These systems' ability to extract information and insight from enterprise documents is maturing. Banks pair this insight with recommendation systems to match products and services," says Naji.

"There is a substantial opportunity for New Zealand companies to develop and export AI-driven financial services products, with markets like the UK having big potential for sales," she adds.