Seventeen South Korean banks are forming a united front to accelerate their artificial intelligence transformation (AX), aiming to reduce individual investment burdens and trial-and-error while identifying items that can be jointly utilized.
According to the financial industry on Wednesday, the Korea Financial Telecommunications & Clearings Institute (KFTC) last month began pushing forward the establishment of a "Banking Sector AX Alliance" (tentative name) based on this framework and recently finalized the participating institutions.
The consultative body includes a total of 17 banks, comprising major commercial banks, regional banks, specialized banks, and internet-only banks. The KFTC plans to hold a working-level meeting this month to discuss detailed agenda items and launch the alliance following an executive-level meeting next month.
The consultative body was established with the aim of identifying tasks that the banking sector can jointly pursue amid the full-scale adoption of AX in the financial industry. If each bank develops similar AI systems separately, costs would rise and trial-and-error in regulatory interpretation, security reviews, and data utilization would likely be repeated. "If banks pursue AX individually, there is a high possibility of conducting overlapping projects. This is about putting our heads together to devise new projects and reduce costs," an official at a commercial bank said. "It will enable us to accelerate AX."
Specific project tasks will be finalized through future working-level discussions. As the KFTC is taking the lead, tasks combining payment settlement with AI are expected to be placed on the discussion table. Also mentioned is a plan to conduct proof-of-concept (PoC) testing to examine whether AI agents, which have recently emerged as a hot topic in the financial sector, can be stably linked to existing financial infrastructure. Discussions on the utilization of digital currencies such as deposit tokens and stablecoins are also expected.
Other candidate tasks include multilingual joint financial services for foreign customers, common AI data synthesis for the banking sector, and establishing regulatory interpretations and security standards for AI utilization. The alliance aims to identify areas where joint commercialization is more efficient than individual bank initiatives and can also serve as a channel for conveying the banking sector's collective views to financial authorities when necessary.
"While banking sector AX has so far focused on internal business efficiency, tasks linked to common financial infrastructure such as payments and data will become important going forward," a financial industry official said. "It is meaningful in that banks will jointly discuss areas that individual banks find difficult to address alone."
