Large banks and telcos are intending invest further in artificial intelligence platforms according to a new report from data analytics and consumer credit reporting company, Experian.

Media services provider Forrester Consulting, on behalf of Experian, surveyed over 1300 C-suite executives and directors from ten countries in the Europe and the Asia-Pacific regions, including 150 from banks and other credit providers in Australia and New Zealand.  The respondents were either in the financial services sector (60 per cent) or telecommunications services (40 per cent).

A key strategic point made in the report was the increased number of borrowers applying for loans through digital channels, and that these potential consumers have more options and less patience than ever before. Balanced against this was the understanding that the impact of sustained high interest rates, coupled with higher cost-of-living expenses, means increased default risk.

Despite these pressures, the report suggested that, within the ten countries surveyed, less than a quarter (24 per cent) of lenders have automated their credit risk decisions, and only a third (33 per cent) believed they have achieved wide adoption. 

Companies in Australia and New Zealand appear to be further ahead in their adoption of automated credit risk decisioning tools, with just 17 per cent stating they either have a limited adoption level or not adopted at all. 

Despite this, one in six (17 per cent) of Australian or New Zealand lenders said they were capable of approving a standard consumer loan in less than an hour, well below the global average (22 per cent), putting them at risk of losing customers to more agile competitors.

However, the statistic for same day approvals paints a better picture with over half (56 per cent) of Australian and New Zealand respondents stating they can approve a new application for a typical customer loan in one day, which is higher than the overall average of 39 per cent.

Among technology executives in the ten countries surveyed, m¬ore than half (53 per cent) have reported significant improvements in decision-making speed and quality due to the application of AI and machine learning. Yet, almost three in five (58 per cent) reported challenges in identifying which GenAI use cases would yield the best ROI.

Despite the push for rapid analytics cycles, only 29 per cent of businesses can implement models in less than six months. This challenge is heightened by the fact that 42 per cent of data and analytics leaders say they lack the in-house expertise to develop and manage the latest advanced

In addition to AI adoption, the report found a clear trend towards improved data and analytics with almost half (49 per cent) of leaders confirming increased budgets for customer insights. Over half (56 per cent) of technology leaders anticipate increasing their technology budgets as economic conditions stabilise, while 51 per cent are focusing on cloud solutions to improve data accessibility for AI-driven credit risk assessments.