The Need for AI Literacy in Financial Services Leadership

Community financial institutions may be reluctant to allocate budget dollars to digital and data solutions. For some leaders, it may be due to the current rate environment. Others may not understand the opportunities advanced technologies and artificial intelligence (AI) can bring to the financial services industry — it’s a lack of digital literacy.

Learn more about how bank and credit union leaders can enhance their digital literacy to foster a more innovative and competitive organization.

Why is AI literacy important?

The gap in AI literacy specifically among board members and executive leadership teams can be a significant barrier to innovation and growth — while also increasing a variety of risk areas.

Having digital competence can help you use AI tools effectively and learn and adapt to a changing digital world to make strategic decisions for your organization. This includes understanding the benefits and risks associated with new technologies, such as cybersecurity threats, data privacy concerns, and the potential for improved customer and member experiences.

Bridge the digital literacy gap

To tackle this issue, discuss education within your financial services organization the same way you promote financial literacy for customers and members. Just as clients are expected to comprehend the basics of financial management, your financial institution leaders must grasp fundamentals of digital technologies such as AI and their potential impact on the industry.

Establish a continuous learning environment

AI literacy is not a one-time achievement, but a continuous learning process. As technology evolves, so must your understanding and skills.

A proactive approach can help your board members and executive leadership teams make informed decisions, drive strategic initiatives, and foster a culture of innovation within your organization.

Consider some of these strategies:

• Develop in-house training modules specifically designed for financial leaders that cover essential digital and AI concepts
• Encourage leaders to enroll in online courses offered by reputed universities or organizations
• Host regularly scheduled workshops and seminars on topics such as blockchain, cybersecurity, AI, and fintech innovations
• Pair leaders with tech-savvy mentors within or outside the organization for one-on-one coaching and guidance
• Implement sandbox environments where leaders can experiment with new AI technologies in a controlled setting
• Temporarily rotate leaders through tech-heavy departments to understand the practical applications and challenges of digital tools.

Embrace the role of AI in financial services

One of the most significant recent digital advancements is AI. Properly and ethically implemented, AI can revolutionize various aspects of banking, from personalized customer and member service to robust fraud detection.

The critical role of AI literacy in evaluating vendors

While AI offers tremendous potential, bank and credit union leaders must lean on their overall digital literacy skills and knowledge around AI to successfully evaluate vendors.

Consider whether a claim that a technology is “powered by AI” is really a selling point. Since there is no official approval stamp validating the authenticity of these claims, effective education can enable your leadership to ask pertinent questions to ascertain if a vendor is authentically leveraging AI.

Navigate the future of financial services

By prioritizing digital and AI literacy, your board and executives can make better tech investment decisions, boosting efficiency and your institution’s leadership in the industry.

Although many organizations won’t be at the cutting edge, embracing digital literacy to help your leadership understand AI and other technologies is crucial for meeting goals and implementing scalable technology solutions. Digital education is essential for leaders to confidently shape the future of financial services, leading to a more resilient and competitive sector.