Growing Financial Software Solutions with AI
2 min read
The financial software sector is experiencing rapid transformation, driven largely by artificial intelligence (AI) adoption and the growing need for digital-first banking. Industry experts predict the global financial software solutions market will reach US$24.4 billion by 2026, a massive leap from US$5.51 billion in 2024.
Ed Patrick, Head of Business Alignment and Strategy for the Technology Division at Legal & General Investment Management, told FinTech Magazine ahead of FinTech Live: London 2025 that the asset management community is now moving “beyond PoC” with AI-driven services enhancing client offerings.
However, rapid software adoption brings risks. The rise of AI-powered cyberattacks and unresolved vulnerabilities commonly known as security debt pose critical challenges. A report by Veracode found that 76% of financial organisations carry security debt, with half of these flaws considered critical.
Security teams face additional challenges with third-party code, which takes far longer to secure compared to proprietary software. This compounds risks for an industry where trust and data security are paramount.
Future of Financial Software
Major institutions are responding with bold digital strategies. Lloyds Banking Group is strengthening its data modernisation and cloud adoption efforts through its partnership with Tata Consultancy Services. Legal & General Investment Management is pursuing a digital-first approach, emphasising the importance of innovation in driving future competitiveness.
“The future of finance will be shaped by those who harness the power of software while effectively managing its risks,” says Patrick. He added that knowledge-sharing and collaboration across industry peers remain key to tackling common challenges in fintech software development.
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