AI’s Hidden Cost: How Financial Institutions Are Gambling with Data – and Losing

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Hitachi Vantara’s 2024 Report Exposes a Looming Crisis in BFSI AI Adoption

Artificial intelligence (AI) is revolutionizing the Banking, Financial Services, and Insurance (BFSI) industry. It promises faster transactions, fraud detection, and automation at an unprecedented scale. But beneath the surface, a storm is brewing.

84% of BFSI leaders fear catastrophic data loss as AI strains legacy infrastructure. 41% say AI is already critical to their operations, yet many are hurtling forward without the data resilience to support it. The result? AI models that fail, security risks that skyrocket, and financial institutions playing an increasingly dangerous game with trust, compliance, and stability.

This is the stark reality revealed in The State of BFSI Data Infrastructure in 2024: AI’s Hidden Cost of Poor Data Quality, a new report by Hitachi Vantara. Based on insights from 231 BFSI specialists, C-level executives, and IT decision-makers across 15 countries, the findings paint a troubling picture:

Data is accessible only 25% of the time when needed

AI models in BFSI are accurate just 21% of the time

36% of leaders fear AI-caused data breaches, while 38% worry about ransomware wiping out their data

32% believe AI-enabled cyberattacks could be the next major security crisis

These numbers expose a dangerous disconnect: AI is being deployed at breakneck speed, yet the financial sector’s data infrastructure is woefully unprepared to support it.

The Cost of AI Failure: A Threat to the Very Core of Banking

Trust is the foundation of the financial industry. When customers deposit money, take out loans, or invest, they assume their bank is operating with precision, security, and reliability. But what happens when AI, designed to enhance operations, becomes a liability?

Mark Katz, CTO of Financial Services at Hitachi Vantara, puts it bluntly:

“The business model in financial services is inherently tied to trust. If a chatbot discloses sensitive customer data because it was included in the training set, the repercussions could be devastating. Worse, if AI produces hallucinated financial insights and a customer acts on bad data, who is liable? The risk is enormous.”

It’s not just theoretical. 71% of BFSI institutions admit they are testing AI in live environments rather than controlled sandboxes. This means financial institutions are experimenting on real customer data, in real-time, with real consequences.

And when something goes wrong?

One wrong AI-generated decision could trigger regulatory penalties

A single security breach could destroy consumer trust overnight

An AI failure in fraud detection could cost millions in financial loss

The BFSI sector isn’t just flirting with risk—it’s walking a razor’s edge.

The Road to AI Resilience: How BFSI Leaders Can Regain Control

Hitachi Vantara’s report doesn’t just diagnose the problem—it provides a blueprint for building an AI-ready data infrastructure that is secure, reliable, and sustainable.

1. Responsible AI Experimentation: Stop Testing on Live Data

AI must be trained and refined in controlled sandbox environments—not in live banking systems where mistakes can cause irreparable damage. 42% of BFSI leaders are still learning AI through experimentation, but without proper safeguards, they are setting themselves up for disaster.

2. Sustainability at Every Level: AI Can’t Succeed on Fragile Infrastructure

AI demands massive computing power and data storage, which strains outdated systems. Institutions must adopt energy-efficient, scalable infrastructure to ensure AI doesn’t just work today, but remains viable for the future.

3. Simplify, Unify, and Secure

BFSI companies often run AI models in hybrid environments with disconnected data platforms. This complexity increases security risks. To fix this, financial institutions must:

Unify data management systems

Automate security monitoring

Use encrypted, self-healing storage

4. AI as a Defense, Not Just a Risk

AI itself can strengthen security if used correctly. Advanced AI-driven threat detection can identify potential breaches before they happen, while immutable data backups ensure ransomware can’t erase critical records.

The Clock Is Ticking: Will Financial Institutions Adapt or Collapse?

The BFSI sector is at a crossroads. AI is here to stay, but rushing forward without an AI-ready data infrastructure could cripple institutions rather than empower them.

The choice is clear:

Double down on AI without fixing data governance and risk a catastrophic collapse

Invest in AI resilience, strengthen security, and turn AI into a long-term asset

There is no room for hesitation. The financial world’s future depends on how it handles data today.

AI will transform finance—but only for those who prepare. Will your institution be ready?

SSS and DICT Join Forces: A Digital Revolution for Social Security Services

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A new era of digital transformation and smart governance is on the horizon as the Social Security System (SSS) and the Department of Information and Communications Technology (DICT) forge a stronger alliance. On March 26, 2025, at the SSS Main Office in Quezon City, SSS President and CEO Robert Joseph Montes De Claro welcomed newly appointed DICT Secretary Henry Rhoel Aguda in a high-stakes discussion aimed at modernizing social security services for millions of Filipinos.

This meeting was more than a ceremonial introduction—it was a pivotal moment that signals a bold, tech-driven transformation in the way Filipinos access government services.

A High-Tech Overhaul: The Future of SSS Services

The conversation between De Claro and Aguda centered on leveraging advanced computing technologies, setting IT standards, and strengthening digital infrastructure to enhance SSS’s service delivery. From cloud computing and cybersecurity enhancements to AI-powered automation, every aspect of the discussion was focused on one goal: making social security services faster, safer, and more accessible.

"Through our strengthened partnership with DICT, Secretary Aguda can guide SSS as we navigate our way through the fast-changing IT landscape," De Claro emphasized. He pointed out that embracing new digital technologies is crucial in ensuring that SSS members experience seamless and efficient transactions—whether they are applying for loans, checking their contributions, or claiming benefits.

For Aguda, the key priority is to eliminate the long queues and bureaucratic bottlenecks that have plagued government offices for decades. His solution? Interconnectivity among agencies in a secure, fully digital environment.

"We will promote changes to reduce queues in availing government services by pushing interconnectivity in a secure environment," Aguda declared, underlining his commitment to innovation and convenience.

A Game-Changer for Overseas Filipino Workers (OFWs)

One of the most impactful outcomes of this digital collaboration will be its direct benefits for OFWs. For decades, millions of Filipinos working abroad have struggled with distance and accessibility issues when dealing with their SSS contributions, pension claims, and benefit applications.

With SSS and DICT working together, the goal is to provide a fully digital, globally accessible platform where OFWs can manage their social security accounts in real-time, eliminating the need for physical visits to government offices.

De Claro assured that this initiative is part of a larger commitment to giving OFWs the social security protection they deserve, ensuring that they remain connected to SSS services no matter where they are in the world.

The Road Ahead: A Smarter, More Efficient SSS

This revamped partnership between SSS and DICT represents a powerful shift toward smart governance. By integrating big data analytics, AI-driven automation, and top-tier cybersecurity, the agencies are laying the groundwork for a next-generation social security system that is resilient, responsive, and future-ready.

For millions of Filipinos, this means a future where social security services are not just accessible, but also seamless, fast, and hassle-free. No more long lines, confusing paperwork, or bureaucratic delays—just a high-tech, user-friendly system that works for the people.

The meeting between De Claro and Aguda is not just about technological upgrades—it is a declaration of change. With innovation at the forefront, this collaboration has the potential to set the gold standard for government digitalization in the Philippines—a transformation that ensures every Filipino, both here and abroad, can access their benefits with ease, security, and confidence.

Philippines Shines Bright in Global Earth Hour: A Record-Breaking 1.3 Million Hours for the Planet

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In an awe-inspiring display of unity and environmental commitment, the Philippines has once again cemented its place as a global leader in sustainability. The 2025 Earth Hour celebration saw Filipinos contributing a staggering 1,377,368 hours to the Earth Hour Bank—outshining all other nations and setting a new benchmark for climate action.

From the bustling streets of Manila to the coastal villages of Sorsogon, Filipinos embraced the challenge, dedicating their time to environmental causes such as coastal cleanups, zero-waste cooking, tree planting, and educational initiatives. Their collective efforts accounted for nearly half of the 2.9 million hours recorded worldwide, surpassing China’s 783,674 hours and India’s 359,652 hours. This overwhelming response is not just a number—it is a call to action, a demand for urgent and concrete environmental solutions.

A Movement That Speaks Volumes

“This is a strong message from Filipinos,” emphasized Atty. Angela Consuelo Ibay, Earth Hour Philippines National Director and WWF-Philippines Climate and Energy Programme Head. “People want breathable air, cooler weather, clean water, healthy forests, and renewable energy. Their participation in Earth Hour is a clear sign that leaders and officials must do more for the environment and our planet.”

And it wasn’t just individuals who took part. A total of 44 institutions, including government agencies, local governments, and corporations, joined the movement, with 28 partners actively organizing switch-off activities in various localities. The Department of Energy (DOE) also reported a significant 161.98 MW reduction in electricity usage, a marked improvement from the 132.11 MW drop in 2024—proving that even a single hour of unified action can lead to tangible energy savings.

Transforming Words into Action: A Thousand-Fold Leap in Participation

The most striking aspect of this year’s Earth Hour celebration was the exponential growth in participation. The 1.3 million hours logged represent a 1,000% increase from the 116,273 hours recorded in 2024. This is not just a testament to the growing awareness of climate issues but also a powerful reflection of the Filipino people's resolve to push for meaningful change.

Community-driven activities played a crucial role in this year's success. In Manila, volunteers and residents came together to paint murals across four barangays, each one inspired by the locals’ vision of a cleaner, greener future. Meanwhile, in Donsol, Sorsogon, environmental advocates gathered in support of marine conservation efforts, reinforcing their commitment to sustainability.

Beyond Awareness: A Call for Political and Cultural Action

While Earth Hour began as a symbolic "lights-off" campaign in 2007, it has since evolved into a global movement that transcends awareness and ventures into policy advocacy and cultural shifts. The Philippines, consistently ranked as one of the world’s most disaster-prone countries, faces escalating threats from climate change. Rising sea levels, extreme weather events, and worsening water scarcity make climate action not just a necessity but a survival strategy.

“Our country has been consistently at the top of the disaster risk index,” said Ibay. “It is about time Filipinos demand concrete actions, not just promises, from our leaders. We need strong policies that protect our communities from the adverse effects of climate change.”

This year’s theme, “Switch Off and Secure Water for All,” underscores the crucial connection between climate change and water security. As a country where millions still struggle with access to clean and reliable water, the Philippines stands at a critical juncture—one where collective action must translate into legislative reforms, corporate responsibility, and sustainable development.

A New Standard for Global Environmental Leadership

With this record-breaking achievement, the Philippines has not only led the world in Earth Hour participation but has also set a new global standard for environmental commitment. The success of Earth Hour 2025 serves as a beacon of hope—proof that individual actions, when combined, can spark a nationwide movement powerful enough to inspire real change.

As the lights flicker back on and the world moves forward, one question remains: Will the leaders and policymakers heed this call? The people of the Philippines have spoken, not just in words but in action. It is now up to the nation’s decision-makers to turn this momentum into lasting, impactful policies that will protect the environment for generations to come.