Introduction
The most significant issue is the limited knowledge of applications, which accounts for 56% of the total, followed by regulatory uncertainty, which ranks second at 38%, an increase from 29% in 2023. Concerns regarding the speed of implementation have surpassed ethical issues, which have fallen from third position to eighth place. Concerns about cost considerations have surpassed ethical issues by 26%.
The adoption of the European Union’s Artificial Intelligence Act, which will regulate artificial intelligence systems according to the level of risk they pose, would be a big issue. Only 11% of the institutions that were polled stated that they were ready for the upcoming rule, and 15% of the institutions do not have an AI risk framework in place. According to another seventy percent, their company is only partially prepared.
The deployment of Gen AI continues to place a significant emphasis on quality control, with the quality of the product being the primary issue for businesses. 54% of respondents are concerned about transparency, and 53% are concerned about data privacy. Only 14% of companies have made the decision to establish an AI ethics framework, while 31% are still in the early stages of development.
Industry Comments
Ayman Awada, EMEIA Financial Services Banking Technology and Gen AI Leader at EY, adds: “Many banks, insurers and asset managers across Europe still have some way to go to reach the next level of AI-enablement. Raising the bar on regulatory readiness, and upskilling new and current staff to embrace Gen AI now and in the future will be the key to unlocking deeper adoption.”
Omar Ali, Global Financial Services Leader at EY, says: “Gen AI continues to sit high on the agenda for financial services leadership teams, promising well-acknowledged new levels of productivity gain.
“There is little doubt within the sector that harnessing AI – and increasingly Gen AI – is game-changing, but the implementation of an evolving technology, to budget, within risk appetite and across an entire workforce, is hugely complex and challenging.”
FAQs
1. What are the biggest challenges in AI implementation for organisations?
A limited understanding of AI applications tops the list at 56%, followed by regulatory uncertainty at 38%, reflecting rising concerns with the introduction of the EU AI Act. Speed of implementation (35%) and cost considerations (26%) have also become critical challenges. Additionally, transparency (54%), data privacy (53%), and output quality remain significant concerns, underscoring the need for robust frameworks to address these issues.
2. How are organisations preparing for the EU AI Act and other regulations?
Preparation for the EU AI Act is lagging, with only 11% of organisations fully ready and 70% partially prepared. Alarmingly, 15% of firms still lack an AI risk framework. The Act’s risk-based regulation of AI systems adds urgency for businesses to prioritise compliance efforts, including implementing frameworks for quality control, transparency, and ethical considerations.
3. What progress has been made in addressing AI ethics?
Ethical concerns have dropped in priority, ranking eighth compared to third previously. However, progress remains slow—only 14% of organisations have implemented an AI ethics framework, while 31% are in early development stages. This shift in focus may reflect the pressing need to address operational and regulatory hurdles first, although ethics remains critical for long-term AI sustainability and trust.
Fintech Insights: Top 10 CTOs Of The Fintech Industry
Conclusion
The landscape of AI implementation is evolving as businesses grapple with new challenges like regulatory uncertainty, operational speed, and cost concerns. The EU AI Act’s risk-based framework amplifies the need for transparency, data privacy, and output quality. Yet, many organisations remain unprepared, with limited understanding of applications and incomplete AI risk frameworks. While ethical considerations have taken a backseat, their importance cannot be overlooked. Firms must balance immediate operational needs with long-term priorities like ethics and compliance to unlock AI’s full potential.
Read: Impact of Fintech on Retail Banking Trends
Read: Top 10 FinTech Cybersecurity Challenges in 2025
Read: Fintech Marketing: Top 10 Power Strategies to Accelerate Growth
We will be back with more exciting articles in the fintech domain!
Write to us for any suggestions.