MAS Collaborates with Industry to Create Generative AI Risk Framework

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The Monetary Authority of Singapore (MAS) has successfully completed the initial phase of Project MindForge, a venture aimed at establishing a risk framework for the use of generative artificial intelligence (GenAI) in the financial sector. GenAI is a dynamic technology that has the potential to both revolutionize and disrupt the financial industry by enhancing efficiency, personalizing customer experiences, and generating innovative product ideas. However, it also comes with inherent risks such as advanced cybercrime tactics, copyright concerns, data risks, and biases.

Project MindForge, supported by a consortium including major financial institutions and tech companies like DBS Bank, OCBC Bank, Google Cloud, Microsoft, and more, delves into both the risks and opportunities associated with GenAI in finance. The consortium has developed a comprehensive GenAI risk framework during phase one, identifying seven risk dimensions encompassing accountability, monitoring, transparency, fairness, legal and regulatory aspects, ethics, and cyber/data security. This framework enables responsible GenAI use in financial institutions. Additionally, a platform-agnostic GenAI reference architecture has been created, offering a guide for organizations to build robust GenAI capabilities.

In the upcoming phase, the MindForge consortium will expand its focus to include insurance and asset management institutions, further refining and extending the GenAI risk framework across the entire financial industry. The consortium aims to develop practical use cases for GenAI, exploring its applications in managing compliance tasks, identifying interconnected financial risks, and addressing areas like anti-money laundering, sustainability, and cyber security. Sopnendu Mohanty, Chief Fintech Officer at MAS, emphasized the importance of establishing a clear framework for the responsible use of GenAI in the financial sector, promoting innovation while ensuring ethical and sustainable practices. Project MindForge is expected to contribute to the evolution of the financial industry through the responsible adoption of AI technologies.