Western European banks to spend US$3 billion on AI

IDC says banks in Western Europe will spend US$3 billion on cognitive computing and artificial intelligence (AI) in 2018. According to IDC’s Worldwide Semiannual Cognitive Artificial Intelligence Systems Spending Guide, the 43% increase from 2017 levels reflects increased use cases for AI in areas such as fraud analysis, sales process recommendation, and IT automation.

Both the private and public sectors are looking at AI to streamline processes and enhance customer and citizen experience. As a result, Western European Cognitive/AI Systems spending is poised to ramp up even further, reaching $10.8 billion by 2022, a 39% five-year CAGR.

Banking will be investing the most on AI in 2018, followed by retail and discrete manufacturing. These three industries together will represent 42% of the overall Cognitive/AI Systems spending in Western Europe. Investments in finance are remarkable as AI allows companies to detect illicit acts on customer accounts and distinguish genuine from fraudulent transactions, which might cause reputational damage and significant financial losses.

"AI is one of the most disruptive technologies we are witnessing and is a key enabler to promote digital transformation," said Andrea Minonne, research analyst, IDC Customer Insight and Analysis. "Banking, retail, and manufacturing are the biggest spenders, but healthcare is also set to experience rapid growth of AI investments. Thanks to its high-speed processing and learning capabilities, AI is a great technology to fulfill tasks that take humans longer to carry out, without compromising the accuracy of outcomes."

The PwC report – Sizing the prize: What’s the real value of AI for your business and how can you capitalize? – speculate that global GDP could get a 14% boost from AI in 2030. This is equal to an additional US$15.7 trillion – “making it the biggest commercial opportunity in today’s fast changing economy”. However, the greatest gains from AI will likely be from China and North America.