Just like past years, a big focus for this year’s CIX was Canada’s changing FinTech landscape — especially how it will be affected by emerging technologies like AI.
In particular, one of the areas that AI can have an impact is in unstructured data; Sensibill co-founder and CTO Jamie Alexander admitted it didn’t sound like the most exciting area, but it could be the thing that brings a legacy institution like banking to the 21st century. “All this data that’s stuck in paper form or in various digital formats can provide homogenous data, which can be used to support other business cases,” Alexander said.
Tomi Poutanen, CEO of Layer 6, indicated that it this vast amount of data means that they can build machine learning models that predict outcomes as effectively as traditional means, such as hiring an analyst to make sense of data.
#AI: Opportunity lies in the tension between focusing on both a grand vision & developing a hyper-focused savant-like capability #CIX2017 pic.twitter.com/5NmZlXMOGB
— Colin Deacon (@colindeacon) October 17, 2017
“Banks are a really interesting customer for us. They know more about their customers know than Google or Amazon or anyone else. They know where they live, how much money they have, and transaction history,” said Poutanen. “The way we approach them is we don’t approach do any hypothesis testing, we just gather and normalize data we have and we build a model that predicts a certain outcome. And we found that the machine learning models are just as effective than traditional models.”
To get ahead of some of the disruption startups present, many banks and regulatory bodies are either working directly with startups or establishing ‘regulatory sandboxes’ to work with startups. Michael Dingle, national deals technology leader at PwC, said that these sandboxes must be designed in a way that startups could continue to innovate with some predictability for what regulation would be. “But moreover, to allow them proximity with regulators so their capacity for innovation isn’t stepped on. And we need to balance that,” he said.
In light of news like the Equifax breach, the question was raised about how consumers can trust institutions that are holding their sensitive data and using it to innovate. BioConnect CIO Bianca Lopes — whose startup offers a biometric authentication system — said that this is a chance for Canada to reach citizens through education.
“In the same way back in the day they talked about stocks and bonds, how do you educate them on data? How do you educate them on what’s protected and what’s not? Maybe this is an opportunity to rebuild trust,” Lopes said.
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