The adoption of artificial intelligence in financial services in South Africa

Artificial intelligence (AI) is one of the driving forces behind disruptive innovations and has transformed how organisations interact and deliver services to their customers. While factors that enable the successful implementation of AI in organisations were previously studied, these studies are still in the early stages. Therefore, the objective of this study was to investigate the success factors for AI adoption by South African financial services companies, using an integration of the diffusion of innovation (DOI) theory and the technology-organisation-environment (TOE) framework. This study also aimed to understand the relative effect of factors affecting AI adoption in financial services in South Africa. The study was administered using an online survey targeting employees of South African financial services organisations. Structural equation modelling (SEM) was used to analyse the data. The results show that only complexity and technical capabilities significantly influenced AI adoption, with managerial capabilities indirectly influencing the adoption of AI in South African financial services. Therefore, when adopting AI in their organisations, the leadership of financial services organisations should consider the costs associated with AI applications, the time taken to innovate using AI, and the application of AI. External environmental factors, government involvement, competitive pressure, and vendor partnerships all had statistically significant results for AI adoption. In addition, this study also aimed to understand the assimilation of AI by customers after adoption by organisations, using the technology acceptance model (TAM). The data was collected using an online survey targeting external customers of financial services organisations, and it was analysed using SEM. The results show that vi perceived ease of use and perceived usefulness are important indicators of how customers experience AI applications of financial services organisations. Therefore, financial services organisations should ensure an optimal level of ease of use and prioritise utilitarian benefits when designing and adopting AI applications.
A research report submitted in partial fulfilment of the requirements for the degree of Master of Management in the field of Digital Business to the Faculty of Commerce, Law and Management, University of the Witwatersrand, Johannesburg, 2022