In preparation for the future of digital banking, Temenos, the Switzerland-based banking software provider, appears to be putting its money on artificial intelligence.

The company announced this month the launch of the Centre of Excellence for Artificial Intelligence to serve as its “innovation engine.”

Emily Steele, president for North America at Temenos, told Bank Innovation her clients are looking for three things: digital, digital, and digital. She said AI is a priority for Temenos across all its product offerings.

“We believe artificial intelligence and data really are going to be the drivers — from a technology perspective,” Steele said.

The goals of the initiative are to get banks AI-ready, spur faster innovation and improve customer experience. Temenos is looking to help banks offer personalized services to customers, augment users’ decisions with data-driven machine intelligence, and maximize processing rates for financial transactions at reduced costs.

“We’re really focused today on those areas where it’s critical business and helping to drive revenue, consumer experience and that whole transformation,” Steele said.

Real opportunities for advancements in AI, she said, come from a confluence of factors such as advances in technology, changes in consumer behavior and expectations, and a willingness among banks and FIs to be competitive in a quickly-changing financial landscape.

The Centre of Excellence, according to a press release from Temenos, “will foster a collaborative ecosystem with Temenos’ banking clients and partners to help identify and validate use cases where AI could have an immediate impact on customer experience, as well as operational excellence, and hence improve the bottom line.”

Temenos says AI will be injected throughout its packaged, digital banking platform, available on premise and in the cloud. The company has already invested heavily in AI across its technology stack from AI-based fraud detection tools, to machine-learning and predictive analytics models. It has also launched its Robo-Advisor, as part of its WealthSuite, a packaged solution that helps financial institutions improve returns and enhance their customer experience through a fully automated or a hybrid digital advisory service.

Prema Varadhan, vice president of the Centre of Excellence, said in a statement:

“AI is an integral part of our platform and an essential component in creating the intelligent bank of the future. We want to make AI capability accessible to all banks regardless of their type and size. Together with our customers and partners we aim to leverage our Centre of Excellence as an innovation engine that will enable banks harness the full potential of new technologies.”

Varadhan is based in London, where the Centre will presumably also be headquartered.

The company says the Centre of Excellence will initially focus on the front office, payments exception handling, and real-time fraud protection. But Steele said there are possibilities for AI to eventually be baked into most if not all aspects of digital banking.

“I think it’s an evolution that’s just going to be continuous,” she said.

Deloitte’s recent State of the AI in the Enterprise report, a survey of more than 1,100 IT workers and executives from U.S.-based companies, found about 42% of executives believe AI will be of “critical importance” within 2 years.

About 82% of respondents said they’ve already seen a financial return from their AI investments, although the financial services and insurance industry has seen a less than median return (about 16%) on investment compared with other industries.

Considering the potential for growth, however, Steele said AI can become a “backbone” for digital banking in the next five years.

“Look at something like Amazon,” she said. “They’ve crafted their interrogation of data and the ability to serve up things to consumers. I believe, in lots of ways, they’re helping drive sort of this new age of artificial intelligence and data mining, and making sure you’re getting the right things to consumers.”