Financial services firms are going all-in on AI and data management investments this year as many feel tech is outpacing their adoption, a new survey from Broadridge Financial Solutions finds.
The fifth-annual Digital Transformation & Next-Gen Technology Study found 80% of the more than 500 firms surveyed are making moderate-to-large investments in artificial intelligence this year, up from 70% in 2024. Half of executives surveyed said they foresee significant adoption by capital markets firms of digital assets and ledger technology in the next few years.
Much of this is driven by a shifting sentiment among respondents as to the quantifiable value artificial intelligence has, Germán Soto Sanchez, chief product and strategy officer at Broadridge, told American Banker.
“There’s still a number of companies that are saying ‘Hey, I’m still having problems quantifying what this is,’ but, year over year, what our survey clearly shows is that the expectations have indeed increased in regards to how people are thinking about the value that’s going to be created by AI,” Soto Sanchez said.
On average, the companies surveyed have over $80 billion in assets under administration. About half of them are based in North America with the other two quarters split primarily between Asia and Europe.
Over two thirds, 68%, responded that they believe generative AI will have the greatest impact on employee productivity. Thirty-five percent said they expect to see a return on investment from generative AI within six months.
“I think that’s pretty unique, because over the last two years there’s been a lot of activity but not a lot in terms of quantification of the impact,” Soto Sanchez said. “It’s a very telling stat.”
A majority of executives, 67%, said they personally use generative AI primarily for investment and market research. Soto Sanchez said in previous surveys executives reported seeing innovations develop out of artificial intelligence but reported feeling the exact value of the return on investment was unclear. This year’s survey found that sentiment shifting.
“We’re starting to see companies beginning to feel that there is going to be some value that they’re going to extract from AI going forward,” Soto Sanchez said. “We’re seeing the investment that’s going into GenAI and then when we talk about being able to extract value from AI, two thirds of companies expect to extract value from GenAI between now and two years. Specifically, about 14% of companies already see the benefits of GenAI – that means there’s demonstrable value.”
Four in ten executives (41%) reported they do not feel their technology strategy is moving fast enough and nearly half, 46%, believe their legacy tech is hurting the company’s resiliency.
A key step toward further adopting AI is ensuring firms’ data is formatted to be compatible with AI models. Nearly six in ten financial services technology and operations executives (58%) identified data harmonization as the primary driver for increased return on investment.
Soto Sanchez said the survey showed how data is becoming more important to AI initiatives.
“We’re seeing data become really front and center in a slightly different way,” Soto Sanchez said. “In the past it was more the era of big data, and what we’re seeing now is more of how data truly is the oil that greases the wheels of transformation at companies. It’s not just ‘I need data to do some interesting analytics,’ but ‘I really need data to offer personalization to my customers, to be able to leverage AI, to be able to create a cloud-based infrastructure.'”
Better data is used in a variety of ways. The survey found executives making investments in cyber security technology, advanced analytics and data visualization in the cloud, digital identity and biometrics.
“These are all things that are fed and sponsored by data,” Soto Sanchez said. “That’s one of the big things that comes out of this. Related and ancillary to that are additional trends that we’re seeing that are a byproduct of [improved data].”
