The recent Broadridge Digital Transformation and Next-Gen Technology Study highlights that 84% of firms in APAC are committing to moderate-to-large investments in AI, surpassing the global average of 80%. This strong commitment reflects the growing recognition of AI's potential to enhance operational efficiency and improve customer experiences.
“Firms that are still trying to drive transformation by bolting on point solutions are quickly starting to realise that there is a limit to how much they can accomplish before they address the fundamental flaws in their platforms,” said Jason Birmingham, Broadridge global head of engineering.
Data harmonisation and operational efficiency
As financial institutions increasingly adopt AI, data harmonisation has become a critical focus. The study indicates that 58% of APAC firms believe digital assets can significantly enhance operational efficiency, compared to 33% globally. This demonstrates the region's proactive stance in integrating advanced technologies into mainstream financial systems. However, challenges remain, as 43% of firms report that regulatory compliance limits their ability to leverage customer data effectively for analytics or AI models.
Chris Perry, president of Broadridge, emphasises, “With the right data management strategy, firms can break down silos and achieve the data quality needed to realise the potential of AI.” This strategic approach is essential for financial institutions aiming to navigate the complexities of digital transformation.
“As financial services firms modernise their operations and move away from legacy systems, many are realising that the right data management strategy has the power to break down silos and achieve the level of data quality needed to realise the potential of AI and sustain prolonged digital transformation within their organisations." Chris Perry
Growing interest in GenAI
While traditional AI adoption is high, the interest in Generative AI (GenAI) is also on the rise, with 49% of APAC firms feeling pressure to implement these technologies. However, GenAI remains in its early stages—only 65% of firms use it primarily for investment or market research. This presents an opportunity for financial institutions to harness GenAI's capabilities for enhanced decision-making and improved customer engagement.
Digital assets and blockchain investments
APAC firms are also making substantial investments in digital assets and blockchain technologies. This year, 79% of APAC firms are investing heavily in blockchain and distributed ledger technologies (DLT), significantly higher than the global average of 71%.
Nearly half (46%) of APAC firms believe that a significant portion of funds and assets will be tokenised in the next five years. This trend illustrates a forward-looking approach to integrating digital assets into financial systems, despite ongoing concerns regarding security and regulatory compliance.
Legacy systems and customer experience challenges
Despite advancements, many institutions face hurdles related to legacy technology. Over half (54%) of APAC firms cite outdated technology as a barrier to improving customer experience (CX). Additionally, 40% find it challenging to design from a customer-centric perspective. The reliance on traditional communication methods continues, with 57% of firms still using hardcopy communications, even when clients prefer digital solutions.
As financial institutions in Asia Pacific navigate the complexities of digital transformation, the findings from the Broadridge study underscore a clear trend: significant investments in AI and digital assets are vital for achieving operational efficiency and enhancing customer experiences. By addressing data harmonisation, embracing GenAI, and overcoming legacy system challenges, APAC firms are positioning themselves for sustained growth and innovation in an increasingly competitive landscape.
