Study Finds Only 11% of Banks Achieve Truly Trustworthy AI Despite Rising Investments

Technology

Study Finds Only 11% of Banks Achieve Truly Trustworthy AI Despite Rising Investments

A new report by SAS, in collaboration with IDC, reveals that only 11% of banks globally have successfully implemented AI systems that are both trusted internally and demonstrably reliable.

The findings, part of the Data and AI Impact Report: The Trust Imperative, highlight a growing disconnect between rising AI investments and the governance frameworks required to ensure trustworthy outcomes.

Banks Lead in AI Adoption, But Gaps Persist

While the banking sector leads industries such as government, insurance, and life sciences in both AI spending and adoption, only 23% of banks rank at the highest level of IDC’s Trustworthy AI Index.

Nearly half (47%) of banks fall into what researchers describe as a “trust dilemma”—either underutilising reliable AI due to lack of confidence or over-relying on systems that have not been adequately validated.

Stu Bradley, Senior Vice President at SAS, noted that despite leading adoption, most banks are still far from achieving the ideal balance between trust and proven AI performance.

Structural Challenges Hindering Progress

The report, based on a global survey of 2,375 IT and business leaders, identifies several key challenges limiting banks’ AI readiness:

Data silos remain a major issue, with 19% of banks still operating fragmented data systems
45% lack robust data governance frameworks
41% do not have centralised or optimised data infrastructure
42% face shortages in specialised AI talent

Kathy Lange, Research Director at IDC, warned that without strong data architecture and governance, banks risk investing heavily in AI initiatives that fail to deliver returns—or worse, erode customer trust.

Middle East Positioned for Growth

Amid ongoing digital transformation initiatives, including the UAE’s Vision 2031, banks in the region are seen as well-positioned to strengthen their AI capabilities.

Michel Ghorayeb, Managing Director at SAS UAE, emphasised that robust data governance, transparency, and oversight will be critical to scaling AI investments and building long-term trust.

Rethinking AI’s Role in Banking

The report also challenges the perception that AI’s primary benefit lies in cost reduction. Instead, banks are increasingly focusing on innovation and customer experience as key drivers of value.

Organizations using AI to enhance customer experience reported the highest returns, generating $1.83 for every dollar invested, compared to $1.54 for cost-saving initiatives. Additionally, companies prioritising trustworthy AI were 60% more likely to double their return on investment.

Growing Focus on Responsible AI

Banks are also accelerating investments in advanced AI systems, including agentic AI, which allows for greater autonomy in decision-making. However, experts warn that without proper governance, the risks associated with these technologies will increase.

Alex Kwiatkowski, Director of Global Financial Services at SAS, stressed that governance, transparency, and strong data foundations must be prioritised before scaling AI systems.

Outlook: Trust as a Competitive Advantage

As AI adoption continues to expand, the report underscores that success in banking will depend not just on technological investment, but on the ability to build trustworthy, transparent, and well-governed systems.

Institutions that align innovation with accountability are expected to gain a competitive edge in an increasingly digital financial landscape.