Financial Brand: How to Evaluate AI Vendors Like a Regulator Is Watching (Because They Are)

AI vendor selection is harder than it looks: Some banks move at breakneck speed, piloting every shiny new tool. Others spend months in risk assessments while competitors push ahead. Only a few find the middle ground: adopting AI with both urgency and discipline. Getting there means asking new questions that most vendor evaluation processes haven’t been updated to handle.

The pressure is real: Roughly half of financial institutions are piloting or implementing generative AI and 8-in-10 bankers worry that not doing so means falling behind. But regulators don’t care about competitive anxiety or vendor promises. They care about explainability and transparency, about whether banks can truly understand, trust and defend the systems making decisions on their behalf. And if we’re making guesses on what the next buzzword in AI regulation will be, it’s actionability. Actionability raises the practical question: can your bank ensure that AI reasoning processes are sufficiently observable to enable timely diagnosis and remediation when failures occur?

Need to Know:

• AI adoption is no longer optional — but reckless adoption is a liability. 
• Traditional vendor due diligence isn’t built for AI. 
• Competitive pressure is distorting decision-making. 
• Regulators care less about innovation and more about actionability. 
• Vendor compliance is bank compliance. 
• The winners will move with urgency and discipline. 

Read entire article from Financial Brand.