AI and tokenisation disrupt finance as risks rise

KPMG urges firms to modernise compliance and culture for digital transformation.

Financial services are changing as digital adoption accelerates, with artificial intelligence, tokenisation, and real-time infrastructure reshaping the industry, according to KPMG.

Sinchan Banerjee, Partner for Financial Services Consulting at KPMG Singapore, said these forces are converging to transform the sector. “These aren't just buzzwords. They are driving fundamental changes across the financial services industry,” Banerjee said.

He noted that AI adoption is maturing rapidly. “In Singapore, we observe financial institutions moving from pilot programs to real world production use cases. Firms are increasingly looking to embed AI across their value chain, and the use cases vary from customer engagement to risk management to compliance,” he said.

Digital assets are also gaining traction, with regulators spearheading initiatives. “[There is] increasing interest from institutional investors to get exposure to this emerging asset class. Regulators are also leading critical initiatives, bringing together policy makers and industry participants to drive key initiatives such as tokenisation of assets,” Banerjee said.

The shift to real-time markets is another driver of disruption. “The shift towards real time markets such as T+1 settlements, near instantaneous payments. These are further compressing timelines and increasing pressure on existing operating models and legacy systems,” he explained.

Banerjee stressed that firms must modernise risk and compliance to avoid slowing innovation. “I think the key is to reframe risk not as a constraint, but as a catalyst to unlock opportunities. Modernising risk and compliance are not just about adding layers of control. It's about redesigning them to be intelligent, to be adaptive, to be automated and to be seamlessly embedded into your business,” he said.

Cultural change will be equally important. “The foundation of a successful digital transformation is cultivating a culture that balances innovation with risk awareness. The most resilient and the most successful organisations foster this mindset built on collaboration, accountability and agility,” Banerjee said.