Financial institutions (FIs) are increasingly focused on how artificial intelligence (AI) can strengthen their competitive edge, rather than questioning its cost-effectiveness.
Around 61% of the surveyed FIs—based on responses from 201 financial services professionals and 20 in-depth interviews conducted between October 2025 and January 2026—are dedicating 10% or less of their technology budgets to AI.
According to Matthew Phillips, PwC China’s financial services industry leader, this reflects a 30% to 40% shortfall in spending compared to global benchmarks.
Respondents noted that AI investments are delivering returns through lower risk exposure, improved compliance, higher revenues, and reduced costs.
Across banking, insurance, and asset and wealth management (AWM), most participants view AI as a catalyst for strategic transformation rather than merely a tool for operational efficiency.
Josephine Kwan, PwC Hong Kong’s asset and wealth management industry leader, highlighted that AI is widely applied in anti-money laundering and compliance within banking, customer service in insurance, and investment, portfolio management, risk management, and data analytics in AWM.
The study also found that talent shortages and organizational inflexibility pose bigger challenges to AI adoption than financial or technical constraints.
Only 29% of financial institutions reported successfully building an “AI-first” culture.
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