Scottish FinTech Aveni has raised $14 million to bring AI to the financial services field.
The company announced its Series A on Monday (July 29), saying it would use the funding to build on its efforts to create artificial intelligence (AI) products and large language models (LLMs) specifically for the financial services industry.
“The financial services industry does not need AI models that can quote Shakespeare, it needs AI models that deliver transparency, trust and above all correctness,” Joseph Twigg, Aveni’s CEO, said in a news release. “The way to achieve this is to develop small, highly tuned language models, trained on financial services data, reviewed by financial services experts for specific financial services use cases.”
According to the release, the new financing will allow Aveni to develop FinLLM, a financial services-specific large language model, in collaboration with new investors Lloyds Banking Group and Nationwide.
The funding comes at a time when the financial services sector has shown some reluctance to embrace AI.
A report last month by the Financial Times (FT) said that concerns about regulations and job losses have prevented banks from adopting AI products.
“The big banks will definitely not adopt [the technology] as quickly as any of the FinTech,” said Tom Blomfield, co-founder of neobank Monzo and group partner at Silicon Valley startup incubator Y Combinator.
He also noted that generative AI will “make banks more efficient and able to provide the same products at a cheaper cost.”
The report cited a study by Capgemini that said only 6% of retail banks were prepared for widespread AI implementation, as well as an estimate by McKinsey that AI could add up to $340 billion in value per year to the global banking sector.
“People don’t understand that it’s there as a productivity tool,” Nasir Zubairi, CEO of FinTech accelerator Luxembourg House of Financial Technology, told the FT. “They still genuinely believe it will take away their jobs.”
Meanwhile, a recent report by the U.S. House Financial Services Committee’s AI Working Group spotlighted the technology’s potential to expand access to credit, enhance fraud detection and improve customer service.
However, the report also also warned of challenges involving data privacy, potential bias in algorithmic decision-making and the need to make sure AI systems comply with the law.
