Bankers across APAC are reflecting their global peers and moving their strategic focus decisively from cost optimisation to innovation and sustainable business growth, as highlighted in the latest Infosys Bank Tech Index edition.
When a shift of this nature occurs, bankers are driven and evaluated more on customer acquisition, product innovation, and digital engagement which we can see in the market. Interestingly, the findings also revealed that artificial intelligence (AI) is generating measurable business value, with more banks seeing strong returns as initiatives mature.
AI’s measurable value
The renewed focus on innovation is aligned with measurably increased investments in scaling AI and cloud capabilities that accelerate digital transformation – and brings positive change to customer and employee experiences. Our experience with top banks shows that innovation thrives when business, IT, compliance, and product teams collaborate. To achieve this, all leaders need to be familiar about the possibilities with AI, data analytics and cloud. Even non-technical roles require clear guidance on how these technologies intersect and impact hyper-personalized banking experiences and operations into the future.
Figure 1. Strategic priorities for APAC banks
Source: Infosys Bank Tech Index: Volume 5, Infosys Knowledge Institute
AI now comprises 9% of technology budgets across APAC with increasing impact. Approximately 26% of banks in APAC indicated that AI generates the most business value in fraud detection. DBS for example uses AI for real-time transaction screening, anomaly detection, and behavioural pattern analysis to detect fraud and unauthorised activities. In another example, Westpac uses a real-time AI-powered call assistant to help their scam and fraud teams detect signs of scams during live customer calls. The bank has reported that this has saved Westpac customers more than AUD500 million.
Approximately 25% of banks cite customer service as where AI delivers the highest value. Leading banks are already realising these benefits: ANZ Bank uses AI to help customers manage their finances more effectively through smarter insights and improved data interactions.AI also has significant potential to enhance productivity in banks with the possibility that generative AI alone could add between $200 billion and $340 billion in value to the sector, through productivity gains. AI-powered chatbots and virtual assistants are streamlining interactions, enabling personalised, real-time customer engagement while optimising operational costs.
In our work with clients, often the focus is on the challenges of tackling unique business opportunities. Aligned with this, our banking-specific small language model, Infosys Topaz BankingSLM, is designed to improve how financial institutions operate by delivering accurate, tailored AI capabilities. Taking advantage of very advanced enterprise AI capabilities helps banks innovate confidently in a rapidly evolving digital landscape.
Figure 2. Functions where AI generates the most business value for APAC banks
Navigating past data, security and compliance challenges
Yet, the journey is ongoing: our research shows nearly half of AI initiatives remain in the early stages, hindered by data management challenges, regulatory complexities and the lack of the right talent. This signals a clear mandate for banks to strengthen data architectures and governance frameworks to unlock AI’s full potential.
Data privacy and security remain the foremost challenges to AI and cloud adoption. Banks are navigating complex regulatory landscapes while ensuring robust data protection. Interestingly, over half of APAC banks consider their data architecture AI-ready – yet they face the most challenges in implementing AI in their data architecture. Security concerns also dominate cloud migration decisions. Strong governance, encryption, and compliance frameworks are essential to manage sensitive customer data safely.
Recruiting tech talent remains a significant hurdle for many banks in the region. Many banks are investing in reskilling initiatives and Governments are also playing a key role to bridge the talent gap. For example, the Australian government is developing a National AI Capability Plan focusing on boosting research, talent development, ethical AI use, and collaboration with industry and academia.
In an environment where talent is the most valuable asset, agentic AI is crucial in augmenting employee capabilities, supporting continuous learning, and powering smarter, faster, and more personalised banking experiences for customers. Our launch of the Infosys Agentic AI Foundry represents a significant step forward in how enterprises can responsibly and effectively adopt AI agents at scale. This platform offers a practical and ethical framework for integrating AI the enterprise. By implementing a multi-agent invoice automation solution within our finance team, we’ve boosted productivity by more than 50%, while achieving notable cost savings and improving overall operational efficiency. This kind of practical AI application is helping us work smarter and deliver better outcomes.
AI-led transformation: a path to reshaping banking
This year presents important opportunities for banks across the high growth APAC region. Those with clear AI-led transformation strategies can build out better capabilities, leading to improved operational efficiency and better customer experiences. As banks continue to test agentic AI, they will see its benefits in enhancing customer experiences through personalized recommendations, seamless onboarding, and proactive support across all channels. This will help attract and retain customers while maintaining a solid position in the market. Although challenges around data privacy, security, and regulatory compliance remain, banks that carefully balance investment in digital tools with effective risk management will be well-placed to navigate the evolving landscape.
Andrew Groth
Executive Vice President, Industry Head – Financial Services, Region Head – Asia Pacific| Infosys
About The Author
Andrew is the Region Head for Infosys AsiaPac and is part of the Global Financial Services Executive. Having lived and worked across Europe, Asia Pacific and the United States, Andrew has rich strategic experience with many of the largest organisations in the world – including major financial institutions. Andrew is a Senior Associate of the Australian and New Zealand Institute of Insurance and Finance, a Graduate of the Australian Institute of Company Directors and holds an MBA from the Australian Graduate School of Management. Andrew also represents Infosys in the Business Council of Australia and participates in the BCA’s Future Growth Industries Committee.
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