Financial Regulators Tighten AI Oversight Amid Rising Risks
Global financial regulators are intensifying monitoring of AI risks as its usage by banks grows. While AI promises productivity, concerns linger about financial stability. The G20's Financial Stability Board warns of potential vulnerabilities from widespread AI model use. Increased regulation and awareness are deemed necessary to address emerging threats.
As banks increasingly adopt artificial intelligence to boost productivity, global financial regulators are stepping up scrutiny of AI-related risks. Amid optimism in the financial sector about AI's potential, concerns remain about its impact on financial stability.
The G20's Financial Stability Board cautioned that over-reliance on singular AI models and hardware could trigger widespread vulnerabilities, akin to 'herd-like' behavior. This brings to light the risk of limited alternatives in the market, a concern echoed in a separate study by the Bank for International Settlements.
Countries like the United States and China are advancing AI technologies rapidly. Meanwhile, the European Union has already begun implementing regulatory measures like the Digital Operational Resilience Act. Increased vigilance and regulation are seen as crucial steps in managing AI-related challenges in the financial sector.
(With inputs from agencies.)
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