Tech Mahindra has released a global survey report titled “Building the AI-Driven Bank of Tomorrow,” developed in partnership with East & Partners. The study explores how artificial intelligence (AI), generative AI (GenAI), and agentic intelligence are transforming global banking into intelligent, seamless, and indispensable ecosystems.
The report draws insights from 150 senior banking executives—including CIOs, CTOs, and CDOs—across 25 countries in the Americas, Europe, the Nordics, and Asia-Pacific. It outlines how the financial sector is accelerating AI adoption to modernize legacy systems, improve customer experiences, and ensure data-driven compliance.
Key Insights from the Report
AI Investment on the Rise:
According to the findings, 81% of banks globally have dedicated AI budgets, with spending expected to nearly double to 17% of total IT budgets by 2028. This marks a decisive shift from pilot projects to enterprise-scale AI implementation.
GenAI Gains Ground:
More than one-third (37%) of financial institutions are investing aggressively in GenAI for early-mover advantage, with European banks leading in adoption.
Data as a Differentiator:
Despite progress, only 20% of banks have a mature, real-time data governance framework. Banks implementing Data Mesh architectures and Explainable AI models are seeing stronger gains in personalization, compliance, and decision-making.
Legacy Modernization Challenges:
While 92% of banks are pursuing legacy modernization, only 14% have exceeded expectations. Nearly one-third have scaled back efforts to balance cost and value, showing that transformation remains a complex, multi-year journey.
Regional AI Spending Trends:
Banks in the Americas allocate the largest share—about 12% of IT budgets (≈US$660 million annually)—to AI. Europe follows at 9% (≈US$499 million), while APAC (7%) and the Nordics (6%) are rapidly catching up.
Customer Experience Takes Center Stage:
Nearly 70% of banks prioritize customer experience as the top AI use case, outpacing automation and regulatory compliance.
Driving Responsible AI Adoption
Kshitij Kumar, Global Head – Banking, Financial Services & Insurance at Tech Mahindra, said, “Across the BFSI industry, AI has moved from experimentation to execution, yet many institutions still grapple with fragmented legacy systems and the complexity of embedding AI responsibly at scale. This report serves as a strategic playbook for banks to navigate the evolving AI landscape with data-backed insights and actionable frameworks.”
Shaping the Future of Banking
The report encourages CXOs to align technology, culture, and purpose to build resilient, human-centric financial ecosystems. It provides frameworks for addressing key challenges such as defining AI ROI, mitigating cybersecurity risks, and managing data silos—ultimately helping banks embed AI responsibly and deliver hyper-personalized, secure digital experiences.
With this report, Tech Mahindra reinforces its leadership in AI-driven transformation for the BFSI sector, guiding financial institutions toward the next era of intelligent and customer-first banking.
