Westpac has joined a new six-member industry consortium established to promote the responsible adoption of artificial intelligence (AI) within financial services, putting forward an initial $230,000 investment to support the group’s research efforts.

Spearheaded by the University of New South Wales’s (UNSW’s) faculties of Engineering and Business, and duly christened the ‘UNSW AI Fintech Hub’, the group will serve as a “one-stop-shop for industry” to explore relevant use cases for AI as well as to tackle emerging challenges associated with the technology.

The group will sit under the UNSW’s AI Institute, established last September by the University.

Westpac and UNSW are joined in the consortium by Amazon Web Services (AWS), Databricks, BrewAI and Cognitivo Consulting, with the door open to other industry partners to join the group.

Professor Fethi Rabhi of UNSW’s School of Computer Science and Engineering said the industry-academia consortium would serve to “take AI out of the lab and into practice”.

“It’s almost like a one-stop-shop for the industry – for businesses who know they want to use AI and have problems to solve, and we will work to solve those problems.

“Industry is crying out for people with expertise in AI and machine learning, so it’s in everybody’s interest for us to advance the knowledge to benefit the ecosystem in Australia as a whole.”

An initial focus area of the group will be to explore the complexities and application of AI in credit risk, while also tackling the net zero transition for businesses, developing new models to more accurately measure and report carbon emissions.

“Both are highly data-driven, technically intensive and regulated areas which have historically relied heavily on human judgement, with the potential for bias or data quality to affect AI outcomes,” the bank wrote in its Westpac Wire blog.

Rabhi added that both “areas of great concern to financial institutions, to which they are dedicating a lot of resources”.

Westpac Group chief technology officer, David Walker, said the bank would reap rewards from the consortium’s research and provide better safeguards to ensure the ethical adoption of AI tech.

“AI is becoming more and more advanced and with that is a need to ensure it is used in the right way, ‘AI for Good’,” he said.

Speaking at TechX, Westpac’s internal tech convention, Walker said that while the bank has been keenly developing AI applications, it has “[held] back” many of these capabilities “until we’re confident we can let it go”.

“Currently all of the artificial intelligence applications across Westpac are ‘supervised’, but ‘unsupervised’ AI is advancing at pace.

“We need to understand how we put the guardrails, the controls in place to make sure that any AI is acting in a responsible, ethical way, that it’s fair and there’s no bias built into it.

“We have a real journey ahead of us to get there, but we’ll be working with some of the leading thinkers in this country and globally through this consortium to help us break this down and solve it.”