Nearly 75% of banks are actively exploring the deployment of gen AI technologies according to a Temenos report published today.

The study, conducted by Hanover Research, surveyed 420 business and technology leaders in financial services in February and indicates that 36% of banks have already implemented or are implementing gen AI, while an additional 39% are evaluating potential applications, according to today’s release.

In addition to improving operational efficiency, institutions aim to leverage gen AI to improve customer experiences and drive business growth.

Despite the enthusiasm, banks express significant concerns regarding gen AI adoption. Of respondents, 86% say data protection as a major issue. Furthermore, 60% are apprehensive about meeting legal requirements, and 59% are wary of “hallucinations,” instances where gen AI produces inaccurate results.

In addition, 73% of banking leaders agree that agentic AI — systems capable of autonomous decision-making and action — will transform the banking landscape.

“This survey highlights both the enthusiasm and challenges banks are facing as they explore gen AI,” Isabelle Guis, chief marketing officer at Temenos, said in the release.

Temenos is addressing concerns from the financial industry by offering flexible deployment options for its gen AI solutions, including cloud, SaaS and on-premises infrastructures. The company is collaborating with leading technology providers, such as Nvidia, to deliver on-premises gen AI capabilities that ensure speed, precision and data privacy.

Register here for the upcoming Bank Automation News webinar “Emerging fintechs: New technologies you need to know now” on Tuesday, April 8, at 11 a.m. EST.