Treasury pushing for ‘robust’ use of AI in banking, but in a ‘gradual’ way

Source Domain: fedscoop.com

The Treasury Department aims to gradually push for the adoption of artificial intelligence (AI) across financial services, emphasizing a partnership approach between public and private sectors.
Secretary Scott Bessent highlighted the need for regulators to work with private partners to identify and address regulatory impediments hindering AI adoption in finance.
The Financial Stability Oversight Council’s Annual Report to Congress listed “Harnessing Artificial Intelligence to Promote Financial Stability” as a priority, underscoring the potential and risks of AI in financial sectors.
Bessent expressed openness to exploring AI sandboxes, regulatory environments allowing for safe testing of AI tools, as promoted by Sen. Mike Rounds and the Senate AI Caucus.
Treasury is focusing on both service improvements (e.g., enhancing customer service processes) and ensuring financial security through AI, acknowledging the dual-edged nature of AI integration.
The department is also working to ensure cybersecurity by aligning regulatory practices with rapid technological advancements in collaboration with financial partners.
Treasury views AI as a crucial tool for bolstering cybersecurity and believes in maintaining resilience and awareness when regulations keep pace with technology advances.

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