HKMA highlights positive GenAI findings for banks

The Hong Kong Monetary Authority (HKMA) reported positive findings from the initial phase of its generative AI (genAI) sandbox, highlighting the technology's potential to add value in banking, particularly in enhancing risk management, anti-fraud capabilities, and customer experience.

This follows the seminar jointly held by the HKMA and Cyberport on genAI, which allowed the first batch of banks participating in the genAI sandbox to share insights and present innovative use cases through interactive exhibitions.

The HKMA said that the initial test results of the sandbox are positive, indicating that GenAI can enhance operational efficiency in the banking sector. For example, the preparation time for suspicious transaction reports can be reduced by 30% to 80%; document processing time can significantly decrease from one day to approximately five minutes; and the time required to generate risk assessment reports can be cut by 60%.

Furthermore, GenAI can optimise processes by offering more comprehensive risk analysis than traditional sampling methods. Additionally, 86% of users rated the GenAI system positively, and over 70% of the credit assessment results generated by GenAI were deemed useful by users.

Looking ahead, 27 use cases from 20 banks and 14 technology partners will be tested in the second phase of the GenAI sandbox, with a focus on strengthening AI governance. This will involve establishing a new risk control model based on "AI against AI", developing dynamic adjustment and self-correcting protection mechanisms, and more comprehensively integrating AI governance into the three lines of defense framework.

Eddie Yue, chief executive of the HKMA, said, “The first cohort of the GenAI sandbox has explored numerous innovative use cases, providing the banking industry with valuable insights into how AI can deliver tangible value for both banks and consumers.”

“The insights have also guided the initiation of project ‘Noor’, in collaboration with the Bank for International Settlements Innovation Hub (BISIH) and other like-minded regulators, with an aim to develop an explainable AI toolkit. We look forward to the second cohort, which will further advance the responsible adoption of GenAI to future-proof banking services,” he added. 

Don’t miss: HKMA banks on 'despicable banana' to fight rising scams

Back in March, the HKMA launched a video series, named "Click the links, fall for scams" (撳LINK中‘蕉’), to raise public awareness of frauds amid growing scam case.

The series serves as a timely reminder in an era when financial security is continually under threat, equipping the public with knowledge to protect their property from malicious schemes. The first video features a "despicable banana," a seemingly innocent character that ultimately reveals its greedy nature as it lures in its victims. In Cantonese, the pronunciation of "banana" is identical to the term used for falling into scammers' traps.

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