Why, What, and How Financial Services Firms can be AI-First: A Joint Study with HFS Research

GenAI has brought AI back into the spotlight for banking and financial services (BFS) enterprises, pushing AI from back-office functions to boardroom discussions. This shift is crucial as AI technologies advance rapidly, offering BFS firms the chance to lead with AI and automation for efficiency, new value, and competitive advantage.

HFS Research, in partnership with Infosys, surveyed 505 BFS leaders globally to understand Why, What, and How BFS firms can be AI-First:

• The WHY: Why are BFS firms investing in AI?
• The WHAT: What’s being invested in and executed to make AI strategies real?
• The HOW: How can BFS firms overcome roadblocks to unlock value?

Key Findings

• The WHY: AI is a new transformation lever but must align with business strategies to avoid focusing solely on productivity.
  • 66% of BFS enterprises updated their AI strategies due to GenAI.
  • Only 12% have global, enterprise-wide AI strategies.
• The WHAT: 2025 is the year for BFS enterprises to make AI a reality, moving from pilots to funded initiatives.
  • AI budgets are expected to increase by 25% in 2025.
• The HOW: Effective AI governance and talent strategies are essential to overcome challenges.
  • Only 23% have mature AI governance practices.

The Bottom Line: Your AI Strategy is Your Business Strategy!

The AI-First leaders in financial services must align their AI strategies with their business strategies, establishing clear purpose and executing with effective governance and the elevation of humans. Through offerings like Infosys Topaz, financial institutions can discover GenAI’s full potential to drive innovation and growth at their organizations.

“The study reveals that BFS enterprises are all in on a formalized and funded embrace of AI – however they risk failure if they don’t drive global, enterprise-wide AI strategies that contemplate more than people-centric bottom-line gains. To unlock the AI-First opportunity, BFS firms must recognize that their AI strategy IS their business strategy, with C-Suite leadership driving clarity of purpose to the rest of the company. This yields AI strategy that is top-down and AI execution that is bottoms-up – ensuring outcomes and impact that matters.”

Phil Fersht,
CEO and Chief Analyst, HFS Research

“Financial institutions worldwide are actively climbing the value chain, leveraging AI to move beyond cost reduction and drive efficiency, modernization, revenue growth, and stakeholder value creation. The HFS-Infosys study reinforces this shift, proving that AI is exponentially becoming a strategic priority, with BFS firms expected to increase AI budgets significantly. However, AI success is not just about investment—it requires a well-orchestrated strategy that aligns technology with business objectives to maximize the impact. At Infosys Financial Services, we have observed emerging patterns where AI adoption is accelerating for high impact business processes alongside broader technology modernization efforts, as well as evolution of the software engineering model. The latest Infosys Bank Tech Index also highlights how banks are aligning their tech spend, prioritizing AI for business value, with a focus responsible AI.”

Dennis Gada,
Global Head of Banking & Financial Services at Infosys

About HFS Research

HFS is a unique analyst organization that combines deep visionary expertise with rapid demand side analysis of the Global 2000. Its outlook for the future is admired across the global technology and business operations industries. Its analysts are respected for their no-nonsense insights based on demand side data and engagements with industry practitioners. Read more about HFS and our initiatives on www.hfsresearch.com.