Febraban Tech 2023 in São Paulo, held on June 27-29, was dominated by two technological themes: generative AI primarily and quantum computing, which is slowly beginning to grab the attention of the banking industry.
AI was the headline topic of the largest number of panels at the three-day event.
“All the banks, 100% of the financial institutions, especially those that are Microsoft customers in some way, all of them knocked on our door [about generative AI], and all of them are asking us to run pilots,” Eduardo Joia, CTO and managing director for the financial services industry at Microsoft Latin America, told BNamericas.
Itaú’s chief data officer (CDO), Moisés Nascimento, said on a panel that the bank is currently studying over 100 cases for generative AI.
However, other technologies have not now become a thing of the past. Cloud was a popular topic, of course, but it no longer attracts the same attention in the sector now that all the major banks in Latin America have migrated at least part of their workloads to a public provider.
The event also addressed connectivity issues, such as private 4G and 5G networks, new forms of customer experience, the challenges of open finance and even partnerships with fintechs and others.
Following the entry of a Uruguayan fintech and Brazilian bank Itaú into its global quantum computing network, IBM is negotiating to bring other financial institutions in the region on board.
“We already have another financial player in Brazil experimenting with quantum computing, as well as companies from Mexico, Chile and Colombia – about two companies from each of these countries – negotiating membership. We expect to sign them up this year,” Wagner Arnaut CTO of technology, cloud and cognitive software at IBM Brasil, told BNamericas.
According to Arnaut, quantum computing is powerful and is advancing rapidly, but it is still at the stage of proving its value to the institutions.
One of the biggest concerns regarding the technology is security, as quantum computing may be able to break current encryption systems in a matter of seconds.
China’s Huawei is seeking a bigger share of the region’s financial technology market, including the hotly disputed public cloud segment, stepping up its competition with AWS and Microsoft Azure in provision of services to banks.
In Brazil alone, Huawei already works with more than 15 banks for IT infrastructure services and is now seeking to win new contracts in the cloud and application area, Airton Melo, Huawei Enterprise Brasil’s head of sales, told BNamericas.
Another area it is betting on is generative AI.
“We think banks should be prepared to welcome the coming AI systems,” Jason Cao, Huawei’s CEO for global digital finance, told BNamericas.
Cao said that Huawei is about to announce a global initiative in the much-hyped technology, which would include applications for banks and other financial institutions.
Brazilian bank Caixa opened negotiations with different public cloud providers as it shifts to a multi-cloud environment for its data, according to the public lender’s digital technology VP, Adriana Salgueiro.
Microsoft Azure is the company’s current cloud provider, notably for the Caixa TEM app created during the pandemic.
“We’re now discussing hybrid cloud and multi-cloud and opening it up to new players as well. We just had a round of talks with the major providers,” Salgueiro said in reply to BNamericas during a conversation with local media.
The idea is for this process to be completed this year and for the bank to earmark resources for contracting new cloud services in its 2024 budget, which should be approved this month.
BNamericas has learned that the talks took place with Google, AWS and even IBM cloud.
In Brazil, Banco Bradesco has reached 150 branches with 5G connectivity through fixed wireless access (FWA), the bank’s superintendent of technology, Gloria Nakajima, said during the Febraban event.
This partnership involves Claro, Embratel, NTT Data, Magna and IBM.
Another bank that has advanced with 5G connection is Itaú, through a contract with Telefônica Brasil, and other banks are using its connectivity solutions, especially for SD-WAN.
“I’m not cleared to disclose the names of the customers, but today we already have three large banks that effectively use 5G in their branches’ infrastructure. Right now, these projects all involve FWA, but we’re in talks for new applications,” Telefônica Brasil’s B2B director, Debora Bortolasi, told BNamericas.