Artificial intelligence is coming for the banks, and it’s not stopping at the doors. Over the next three to five years, up to 200,000 jobs in the banking sector could disappear as AI systems take over tasks currently done by humans, according to a report.
That’s about 3% of the global banking workforce—gone. The jobs at risk? The boring, repetitive ones. Think back-office tasks, middle-office duties, and even customer service functions.
Tomasz Noetzel, the analyst behind the report, said if your job involves doing the same thing over and over again, it’s on AI’s radar.
AI bots are already gearing up to handle customer management and know-your-customer checks, while other roles in operations could get axed. The transformation won’t be total annihilation though. Noetzel believes AI will change the workforce rather than eliminate it entirely.
Profits soar, jobs shrink
Some banks are looking at this as a win-win. While people are worried about their jobs, the numbers are making executives smile. The report predicts that by 2027, AI could push banks’ pretax profits up by 12% to 17%, which translates to $180 billion in extra cash.
Productivity? Through the roof. More than 80% of executives surveyed expect generative AI to boost productivity and revenue by at least 5%.
Banks have been getting ready for this for years. After the 2008 financial crisis, they modernized their systems to speed up processes and cut costs. AI just feels like the natural next step.
And now, with generative AI—those super-smart systems that can create everything from essays to financial models—banks are jumping in headfirst.
Jamie Dimon, the CEO of JPMorgan Chase, says thousands of employees are using AI to handle tasks that were previously a drag. Dimon thinks AI might even make life better, predicting that workweeks could shrink to just three and a half days.
“Your children are going to live to 100 and not have cancer because of technology,” he said. He’s all-in on AI, calling it “critical to our company’s future success.”
JPMorgan has more than 300 AI projects running and advertised over 3,500 AI-related jobs earlier this year. They’re using AI to create new products, improve customer interactions, and manage risks better than ever. Dimon even dedicated a chunk of his shareholder letter to AI, saying it’s an “absolute necessity” for the bank’s future.
The bigger picture
JPMorgan isn’t alone in this. Citigroup, Deutsche Bank, and ING are all chasing the AI dream. Citi says 54% of banking jobs have high automation potential. Another 12% could be enhanced with AI, meaning humans and machines will work side by side.
The bank’s CTO, David Griffiths, called AI a “revolution” for the industry. Citi has allegedly equipped 40,000 coders with AI tools to speed up tasks like analyzing regulatory changes.
Deutsche Bank is using AI to comb through the portfolios of wealthy clients. ING is deploying it to predict which customers might default on loans. Citi pointed out that new jobs will come out—think AI managers and compliance officers—to make sure the tech is used responsibly and aligns with regulations.
And here’s the twist: new technology doesn’t always kill jobs. Remember ATMs? When they hit the scene in the 1970s, everyone thought human tellers would become extinct. Instead, the number of tellers grew for decades as banks expanded their services.
Citi thinks we might see something similar with AI. Sure, it’ll replace some roles, but it could also open doors to entirely new ones. That said, AI isn’t all rainbows and profits. Dimon was blunt about the risks. “Technology has done unbelievable things for mankind, but, you know, planes crash, pharmaceuticals get misused—there are negatives,” he said.
His biggest worry? Bad actors using AI for malicious purposes. It’s a double-edged sword, and banks know they’ll need to stay sharp to prevent misuse.
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