Big banks have no advantage over financial technology start-ups when it comes to artificial intelligence, a former Barclays chief executive has said.
Antony Jenkins, who led the bank between 2012 and 2015, said that banks have a tendency to focus on mainframe data storage rather than seeking solutions on the cloud.
"I think the biggest myth of all… is that banks and other financial services providers are advantaged in this new world because the logic is that they have a lot of data and therefore they ought to be able to be better placed to run these algorithms," he said Tuesday at the LendIt Europe fintech conference in London.
Data is fundamental to machine learning and artificial intelligence. The development of big data — huge datasets used to highlight patterns and trends — allows computers to predict future behavioral trends based on complex algorithms.
"The truth of the matter is that in almost every financial institution, data is fragmented across many different technology stacks, and it is incredibly difficult to run even machine learning on these databases," Jenkins said.
He added: "Most banks will try to pull them into a central repository, it requires data cleansing. It's very expensive, very slow, and actually frankly imperfect because the data is in the wrong place."