The transformative potential of generative AI in finance

Deluxe Chief Technology Officer Yogaraj (Yogs) Jayaprakasam recently presented a webinar on the potential, pain points, and payoffs of Generative AI (GenAI) to an audience of finance executives and industry leaders. 

The value of Generative AI can be measured in multiple ways, first looking at the economic impact and then the major applications within finance. Jayaprakasam shared that according to a Boston Consulting Group Report, GenAI can automate up to 40% of finance functions. The annual economic value is also startling, with McKinsey predicting $2.6 to $4.4 trillion from GenAI. 

How has AI transformed?

Jayaprakasam talked about the journey and transformation that AI has undergone – moving from speech recognition and intelligent automation to where we are currently with GenAI and autonomous systems. AI falls into two parts: traditional and generative. 

Traditional AI analyzes content to make predictions and prescribe action. For example, machine learning and analytics fall into this bucket, meaning that traditional AI can forecast growth based on historical data or provide hyper-personalization of user experience. 

Generative AI, on the other hand, generates new content or better comprehends existing content than traditional AI. An example of GenAI includes large language models such as ChatGPT. GenAI can be used to create images based on text, answer questions from the knowledge article or summarize an existing article. 

Use cases for Generative AI

The use cases for Generative AI are expanding. According to a 2023 research study by Datos Insights, those use cases fall into four buckets: Sales/relationship management, back office, fraud, AML, and customer-facing. Regarding deployment priority, sales and relationship management use cases are deploying first, with customer-facing generative AI to deploy last. 

While all four areas can influence finance and treasury, Jayaprakasam focuses on back-office applications and customer-facing areas like cash forecasting and payments reconciliation.

 "You can start experimenting with some of these back-office functions with Gen AI," he said. "That's where we [at Deluxe] are actively playing. And we are seeing some prominent benefits that we will put to good use as we continue to drive that maturity. Then there is fraud and AML; anomaly detection in massive amounts of data is the best place to use technology like generative AI."

Deluxe's Receivables360+ leverages traditional AI and advanced machine-learning technology to "read" electronic remittances, match payments to open invoices, identify errors and more. By doing this, the Deluxe Receivables+ Suite helps businesses capture enterprise-wide insights by turning their receivables data into a valuable resource equipped with custom dashboards to fuel real-time business decisions. 

But what can GenAI do for treasury? Jayaprakasam shared three ways finance professionals can use emerging AI technology today: 1) accelerate and improve their training, 2) co-create with an intelligent copilot and 3) strengthen results with proprietary data.

Did you miss the live webinar? You can watch the full replay discussion on-demand.