Singapore Emerges as Leader in Financial Services AI Implementation

AI deployment in financial services has reached a significant milestone, as only 2% of institutions worldwide have not implemented AI in any capacity. This shift signifies that AI has transitioned from theoretical discussions to practical applications within the industry.

According to recent research conducted by Finastra, which surveyed 1,509 senior leaders across 11 markets, Singaporean financial institutions are at the forefront of this transformation. Nearly two-thirds of Singaporean institutions have already integrated AI into their operational frameworks, moving beyond experimental phases.

The “Financial Services State of the Nation 2026” report indicates that 73% of institutions in Singapore have either implemented or enhanced AI use cases in their payments technology over the past year, a figure almost double the global average of 38%.

Chris Walters, CEO of Finastra, highlighted Singapore’s exemplary approach to scaling AI deployment, emphasizing the integration of AI into core operations supported by robust infrastructure, solid data foundations, and effective governance practices.

Globally, 31% of institutions have achieved scaled deployment across multiple functions, while 30% have initiated limited production deployment. This shift signifies that AI is no longer confined to experimental labs but has become an integral part of banking operations.

In Singapore, an additional 35% of institutions are exploring AI applications beyond their current deployments, showcasing a strong innovation pipeline that positions the city-state as a regional leader in AI adoption.

The primary objectives driving AI deployment vary across markets. In Singapore and the US, 43% of institutions are leveraging AI to enhance compliance and regulatory processes, demonstrating the technology’s capability to navigate complex oversight requirements while ensuring operational resilience.

Cloud infrastructure plays a crucial role in enabling scalable AI deployment. In Singapore, 55% of institutions host all or most of their infrastructure in the cloud, with an additional 30% operating hybrid environments. This cloud-first approach provides the necessary infrastructure for enterprise AI deployment, ensuring scalability and resilience.

Looking ahead, institutions globally plan to increase investment in modernization, with Singapore leading in planned spending increases of over 50%. Furthermore, Singaporean respondents expressed strong confidence in their technology foundations, rating their core infrastructure, security, and reliability ahead of global averages.

As AI deployment accelerates, so do security threats. Institutions globally anticipate a 40% increase in security spending in 2026 to address evolving risks. Singapore leads in deploying advanced fraud detection and transaction monitoring systems, emphasizing the need for AI-powered defenses against fraudulent activities.

Talent shortages remain a significant barrier to AI deployment, with 54% of institutions in Singapore citing this as a challenge. To address this gap, institutions are increasingly partnering with fintech providers to access AI capabilities without the burden of talent acquisition or system development.

In conclusion, the financial services sector has successfully adopted AI but now faces the challenge of scaling responsibly. Success in this endeavor will be defined by embedding intelligence into operations while maintaining trust and transparency. The research surveyed managers and executives from various global markets, highlighting the industry’s collective shift towards AI adoption and integration.