Generative Artificial Intelligence in Finance: Risk Considerations

Fintech Notes, August 22, 2023

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Bibliographic details

• Authors: Ghiath Shabsigh, El Bachir Boukherouaa
• Published: August 22, 2023
• Series: Fintech Notes
• DOI: https://doi.org/10.5089/9798400251092.063

Overview and purpose

• Authors: Ghiath Shabsigh, El Bachir Boukherouaa
• Publication date: August 22, 2023
• Series: Fintech Notes No 2023/006; Issue: 006; Volume: 2023; Pages: 24
• DOI: https://doi.org/10.5089/9798400251092.063
• Stock No: FTNEA2023006
• ISBN: 9798400251092
• ISSN: 2664-5912
• Subject: Artificial intelligence, Economic sectors, Financial crises, Financial sector, Fintech, Technology
• Keywords: AI-machine learning, artificial intelligence, cybersecurity, embedded bias, financial risks, Financial sector, financial sector policy and analysis, financial stability, fintech, generative, generative artificial intelligence in finance, Global, hallucination, IMF Fintech Note 2023/006, IMF Library, machine learning, privacy, sample generative AI application, synthetic data

Key findings about GenAI adoption in finance

• Technological advances and competitive pressures have fueled rapid adoption of artificial intelligence (AI) in the financial sector.
• Adoption is set to accelerate with the recent emergence of generative AI (GenAI).
• GenAI represents a significant leap forward in AI technology that enhances utility for financial institutions and has been quickly adapted to a broad range of applications.

Identified risks inherent in AI and amplified by GenAI

• Embedded bias.
• Privacy concerns.
• Outcome opaqueness.
• Performance robustness issues.
• Unique cyberthreats.
• Potential for creating new sources and transmission channels of systemic risks.
• GenAI could aggravate some existing risks and bring about new types of risks, including risks to financial sector stability.

Purpose and scope of the paper

• Provides early insights into GenAI’s inherent risks and their potential impact on the financial sector.

Distribution and access notes

• Format: Fintech Notes (web landing page with PDF available)
• Available through the IMF eLibrary.

Generative Artificial Intelligence in Finance: Risk Considerations, Fintech Notes 2023, 006 (2023).

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