As many as one in five jobs in the financial services sector could be replaced by robots within the next five years, a new survey has revealed.
Research by KPMG and recruitment firm Harvey Nash showed the rapid rise of new technology such as automation and AI could remove the need for up to 20 per cent of financial services roles.
More than 40 per cent of banks said they expected a fifth or more of their workforce to be replaced by robots, rising to nearly half for insurance companies.
This compares to a global average of just over a third, according to the report.
“Sectors such as insurance are investing heavily in automation, with over half of IT leaders in this sector reporting that they are either piloting or implementing AI or machine learning,” said Albert Ellis, chief executive of Harvey Nash.
“Claims processing, policy issuance, administrative tasks – these are all clearly functions ripe for AI.”
Ellis added that despite previous forecasts of a so-called big bang in automation, the rise of robots was likely to happen incrementally.
Despite the threat of new technology, the majority of respondents in the banking and insurance sectors said they believed new jobs will emerge to compensate for the losses.
The survey also found that more than half of banks and insurers increased their IT budgets over the past year.
Earlier this year the Office for National Statistics warned more than one in three jobs in the Square Mile could be at risk from new automated technology, with financial services branded the most vulnerable sector.