The Application of Artificial Intelligence and Machine Learning in Financial Stability

Abstract

In recent years, with the rapid development of artificial intelligence (AI) and machine learning, they have been widely used in various aspects of the financial field, and have a significant impact on the financial market, financial institutions, financial supervision and so on. The financial stability Council (FSB) has issued the development of artificial intelligence and machine learning in the financial service market and its impact on financial stability. The people’s Bank of China has also put forward the regulatory requirements for “intelligent investment advisers” in the “guidance on regulating the asset management business of financial institutions (Draft)”. The application in the financial field is becoming more and more common. With the deepening of the application of artificial intelligence and machine learning, it will bring a series of far-reaching impacts on the financial field at the micro and macro levels, and will also bring challenges to financial stability. The report suggests that at this stage, based on the practical assessment of the application risks of artificial intelligence and machine learning in data privacy, operational risk, network security and other fields, continuously improve the interpretability of the application models related to artificial intelligence and machine learning, and strengthen the supporting supervision of the application of artificial intelligence and machine learning in the financial industry. This paper summarizes the development of AI and machine learning in the field of financial services, analyzes the impact on micro, macro-economy and financial stability, and puts forward some suggestions on strengthening financial supervision by AI and machine learning.