Introduction

In an exciting move that marks a milestone for Canadian banking, the Royal Bank of Canada (RBC) has partnered with artificial intelligence company Cohere Inc. to develop an advanced generative AI platform tailored for financial services. This groundbreaking initiative positions RBC as a pioneer among Canadian banks, enhancing operational efficiency through innovative technology.

Generative AI at RBC

As the largest bank in Canada, RBC is making strides in integrating AI solutions to streamline employee workflows. Generative AI, while not new, has traditionally been restricted to specific functions or experimental phases within the financial sector. However, the recent partnership aims to change that by deploying a customized version of Cohere’s generative AI platform across the bank's operations.

The North for Banking Platform

The new platform, named North for Banking, is designed to assist employees in completing tasks and gathering information. With its capability to respond to specific customer needs, the platform allows staff to input relevant context about clients, enabling it to generate tailored solutions and advice.

Focus on Security

Dr. Foteini Agrafioti, RBC's Borealis senior vice-president and chief science officer, emphasized the importance of ensuring security while utilizing generative AI. "We have not yet been comfortable bringing RBC sensitive data closer to these technologies until now," she stated, highlighting the bank's commitment to a secure deployment of North for Banking.

Current Applications of AI at RBC

Internally, RBC has already started using generative AI for specialized applications, including enhancing customer service operations and aiding research analysts within its capital markets unit. This demonstrates the bank’s proactive stance toward leveraging technology for improved service delivery.

RBC's Ranking in AI Maturity

In an evaluation of AI maturity, RBC recently ranked among the top three global financial institutions in the Evident AI Index, ahead of many competitors, including Toronto-Dominion Bank, which secured the ninth position. This acknowledgment underscores RBC's ongoing efforts to embrace cutting-edge AI technologies.

About Cohere

Founded in 2019, Cohere specializes in building large language models (LLMs) that facilitate chatbots and generative AI platforms. These models analyze text and media to produce insightful responses and can be customized to meet diverse business needs, from improving policy assessments to automating routine processes.

Cohere's Growth and Investment

Cohere has seen significant investment growth recently, including a $240 million commitment from the federal government to pave the way for a new multibillion-dollar data center in Canada to support AI modeling. This financial backing is vital as the startup raised $500 million in July to enhance its competitive edge against industry giants like OpenAI and Google, resulting in a valuation of $5.5 billion.

Global Trends in Banking and AI

Banks worldwide, including JPMorgan Chase and BBVA, are also exploring generative AI, reflecting a growing trend in the financial sector. However, regulatory concerns about privacy and data security remain prevalent. For instance, Canada’s privacy commissioner is investigating ChatGPT due to complaints regarding data usage without consent, and similar concerns prompted Italy's data protection agency to fine OpenAI €15 million.

Security Measures in RBC's Collaboration with Cohere

RBC's collaboration with Cohere takes a crucial step towards ensuring that all data utilized is securely powered and stored within the bank’s internal systems. The implementation leverages RBC’s substantial investments in infrastructure, including one of Canada’s largest GPU farms, which is essential for training AI systems with large data volumes.

Conclusion

With the launch of the North for Banking platform, RBC is poised to redefine not only its operational effectiveness but also the customer experience in the financial sector, setting a new standard that could influence banking practices across Canada and beyond.