Finance

The Shift ToAgentic Finance Has Serious Implications For Banks

Published

7 months ago

October 26, 2025

The Shift ToAgentic Finance Has Serious Implications For Banks

Humanoid robot is on display during 2023 World Robot Conference at Beijing Etrong International Exhibition & Convention Center on August 19, 2023 in Beijing, China. (Photo by Zhan Min/VCG via Getty Images)

VCG via Getty Images

As I wrote back in 2019, and McKinsey wrote back in August, once AI-powered software agents (that is, bots) start making more sophisticated financial decisions on behalf of customers, we will see a reshaping of banking that will affect billions of dollars in revenue. My bumper sticker version of future agentic finance landscape is quite straightforward: The AI revolution isn’t banks getting AI, it is customers getting AI.

Agentic Finance Is Inevitable

This has huge implications for the banking sector. The former Standard Chartered Group Chief Data Officer Shameek Kundu said in the Citi GPS’ report on “AI in Finance: Bot, Bank & Beyond” that “the biggest new thing will be the growth of non-human customers” and I could not agree more, which is why I have been looking at the implications for some time. In particular, I have become fascinated to see how banks and other financial services organisations (who sell very commoditised products such as checking and savings accounts) will adjust to acquiring agent customers who do not care about the bank Superbowl ads or which sports teams it sponsors.

When my AI-controlled smart wallet uses open banking data and decides that I need a different savings account or refinance my car loan, how will my network of bot advisors decide which provider to use? After all, savings accounts and car loans are boring, there are lots of them to choose from and even if I did take the time to read the terms and conditions I wouldn’t understand them. When it comes down to it, I don’t really want to be in the loop on these because I’ve got better things to do. Bot’s don’t/

Now one rather obvious thing that bots will base their decisions on will be price, so from a strategic perspective it seems to me that banks will likely need to compete much more sharply on price to retain clients’ wallet share. Bots can compare multiple prices simultaneously, so being the cheapest will likely always be a significant factor. One strategic response from institutions could therefore be to adopt an execution-focused strategy focused on operational efficiency. They could cut out the money wasted on TV advertisements that bots don’t look at and use the modern to modernise and revitalise their IT infrastructure, thereby enabling them to compete on volume and win those deals that are purely based on price.

In this kind of environment, as you might easily imagine, all prices will rapidly fall to the lowest level and this has very significant implications on the business models of commercial banks and others. In fact McKinsey’s new Global Annual Banking Review for 2025 says that $23 trillion of the $70 trillion in the consumer banking sector are held in zero interest accounts. Unless banks adapt their offerings, this could amount to a loss of 9% to the bottom line, which would push average returns for banks below the cost of capital.

AI has a role to play in revitalising the banks infrastructure, of course, and this will help to reduce costs (McKinsey think this might mean initial savings of between 15% and 20% of operating costs) but of course those benefit will soon be competed away. This means that banks will need to find other competitive advantages. But what could these be?

Future CX.

In common with many other industry observers, I think that one area to focus on is digital identity. For commercial banks, they have an inbuilt advantage. As Kirsty Rutter, the Fintech Investment Director at Lloyds Banking Group in the U.K., said “our digital identity has become our most valuable digital asset”. Numerous fintech companies have emerged working to tackle different aspects of the identity challenges across identification, authentication and authorisation but there is still way to go to get a comprehensive infrastructure in place to provide the essential elements of the trust framework.

When you look at the rapid evolution of agentic finance and agentic commerce, it is clear that the platforms and protools are outpacing the trust frameworks needed to build real-world products and services. In another of their recent reports, McKinsey pointed in this direction and said that what they label “credentialling and identity” is the first of their key control points in the agentic economy because agents need secure, user-granted permission before they can initiate transactions across multiple institutions. Therefore, as they point out, organisations that already manage high-trust credentials start with a clear advantage. They go on to highlight some success factors: zero-trust architectures that never assume persistent access, dynamic consent via standardized protocols (for example, OAuth2/OpenID Connect) and continuous audit trails.

Agentic Finance As Dark Energy

Financial institutions should be looking at the opportunities here as a way of staying relevant, as a way for remaining relevants to transactions that pass unnoticed through the current financial systems, a kind of financial dark energy made of wallets and stablecoins, AP2 and x402, exchanging value without ever touching banks and banking networks. All of those transactions wll need varying kinds of trust and one of the reasons why I am so bullish about the transition to agentic finance is precisely because of the transition from antiquated security theatre based on passwords, pictures of buses and emailing photos of passports to an infrastructure of privacy-by-design privacy and actual security. The fact of the matter is that people are just not very good at security: We are the weakest link and, as I am fond of remarking, it’s quite easy to fool someone with a fake picture of Brad Pitt, it’s impossible to fool their bot with a fake Brad Pitt digital signature.

It’s not a hard prediction to make that AI is going to change our industry just as its going to change every other industry. But I think it’s important to note that this is about more than saving a few people in the call centre or making slightly better credit decisions. The industry is going to be shaped by what customers do with AI and the evolution of agentic finance will lead to a very different kind of industry but it will be an industry that services its customers far better than the half-analogue, half-digital transition industry that we have today.

Finance

How can I illustrate our financial position to a spouse who shows little interest?

Published

3 hours ago

June 3, 2026

Press Room

How can I illustrate our financial position to a spouse who shows little interest?

Reader question: My spouse has little interest in our financial position. As we age, this concerns me. I try to share some basic information (income, spending, account balances, debt, and so on) each month but rarely get a response. I think graphs or charts might be of more interest to her than a bunch of numbers. What recommendations would you have for illustrating our financial position so that I am not the only person aware of how we are situated? Thanks!

Answer: Your situation is pretty common. Most couples I know develop a division of labor over time, where one person is in charge of financial matters and the other person is less involved. That’s definitely the case for my husband and me. He’s in charge of paying all the monthly bills and preparing our tax returns, but the financial planning and investment decisions are up to me. This type of arrangement might work well for a long time, but can become less sustainable with age, particularly if the “finance person” in the relationship dies or develops a major health issue.

Online tools and mind maps

Illustrating your financial situation with charts and graphs is a great idea that might help your spouse become a little more involved. Morningstar’s  Portfolio X-Ray  tool includes a variety of images that help illustrate your financial situation. Websites for most major brokerage firms also include some visual tools. Schwab, for example, offers a Portfolio Checkup and a bar graph illustrating your account’s monthly income from dividends and interest income. Vanguard has a Portfolio Watch tool and a variety of performance illustrations, tools, and calculators.

A  mind map, which we used with clients when I worked for a financial advisory firm, can be another way to picture your entire financial situation on one page. There are various  softwaretemplates  for drawing a mind map, or you can simply sketch it out with a large sheet of paper and a pencil. Start with your names at the center of the page. Then draw spokes connecting to various categories, such as names of other family members; investment accounts; real estate and other assets, insurance policies, estate plans, key goals and values, and contact information for accountants, estate planners, and other professionals. It can be helpful to go through the mind map together and make any updates needed at least once a year.

Other ways to communicate about money

A few other ideas—though not related to charts and graphs—might also be useful.

I like the idea of putting together a  net worth statement  that itemizes cash, taxable accounts, real estate, retirement accounts, and debt for each member of the couple as well as items owned jointly. It’s a good idea to update this document at least once a year and  discuss it as a couple. If you set up the document as a spreadsheet, you can include columns with additional information such as account numbers, what each account is used for, which accounts are subject to required minimum distributions, or tax issues like potential capital gains.

Many couples also put together a  binder  (sometimes humorously called a “Doomsday Book”) that contains information about where to find important paperwork, insurance policies, how bills are paid, what each account is for, steps the surviving spouse will need to take, final wishes, and any other critical information.

A well-qualified financial adviser can bridge the information gap

Finally, you could consider working with a good  financial adviser,  who can help involve your spouse in financial matters while you’re still living and step in to fully manage investments and personal finance decisions if you pass away before your spouse. Make sure the adviser holds the Certified Financial Planner designation and charges fees that are reasonable. Although a 1% fee is still the industry standard for accounts of $1 million or less, it’s possible to find advisers who charge significantly less, including a few who price their services based on hours worked instead of a percentage of assets under management.

_____

This article was provided to The Associated Press by Morningstar. For more personal finance content, go to https://www.morningstar.com/personal-finance.

Amy C. Arnott, CFA, is a portfolio strategist for Morningstar and co-host of The Long View podcast.

Finance

Proximo Congress 2026: US Energy & Infrastructure Finance | Insights | Mayer Brown

Published

13 hours ago

June 3, 2026

Press Room

Proximo Congress 2026: US Energy & Infrastructure Finance | Insights | Mayer Brown

Mayer Brown is a proud sponsor of Proximo Congress 2026. This senior meeting of the US energy, infrastructure, and digital infrastructure finance community is shaped around the questions credit and investment committees are actually asking in 2026: how asset classes are converging, how risk is being priced in a recalibrated policy and geopolitical environment, and how public and private capital are being structured together to deliver projects at scale.

Mayer Brown has also been recognized for three separate awards which will be presented during the event. These awards include:

Proximo North America Transport Deal of the Year 2025 – SR 400 Peach Partners
Proximo North America Rail Deal of the Year 2025 – Brightline West
Proximo North America LNG Deal of the Year 2025 – Port Arthur LNG 2

For more information, visit the event website.

Finance

What are nonconforming mortgages and what are the risks?

Published

23 hours ago

June 2, 2026

Press Room

What are nonconforming mortgages and what are the risks?

If you have ever taken out a mortgage, you’ll know there are a lot of requirements to meet. You may need to put down a certain amount and have a debt-to-income ratio below a certain threshold. You may also run into limits on how much you can borrow or what sources of income the lender will count.

These rules do not apply to all mortgages — just to conforming mortgages, which is what the majority of borrowers take out. However, mortgage lenders are increasingly offering what are known as nonconforming loans, or mortgages that do not “comply with every one of the strict standards put in place after the housing crisis,” said The Wall Street Journal. While “still a small portion,” the “share of mortgages using alternative lending practices” has “doubled in size over the past three years.”