In an era where artificial intelligence (AI) promises to redefine regulatory compliance, organisations are learning that human expertise remains essential for success.
Shwetha Shantharam, AVP and product head at 4CRisk.ai, explores how a strong “human in the loop” strategy helps companies bridge the gap between potential and performance in AI-driven compliance. With over 20 years’ experience—five of which are focused on building AI-enabled products for risk and compliance teams—Shantharam explains that empowering professionals to guide AI ensures it strengthens rather than threatens their roles.
The recent MIT study The Gen AI Divide highlights the key challenge: while enterprises invest $30bn to $40bn in AI initiatives, 95% of projects fail to deliver measurable value. According to MIT, 60% of organisations evaluate enterprise-grade AI systems, yet only 5% reach production, often due to “brittle workflows, lack of contextual learning, and misalignment with operations.” The problem, the study argues, lies not in model quality but in a “learning gap” that limits user adaptation and integration.
However, some critics have challenged MIT’s methodology. The Marketing AI Institute’s founder and CEO, Paul Roetzer, claims the study uses a narrow definition of ROI, failing to consider broader business outcomes such as efficiency gains, cost reductions and improved customer retention. Regardless of the debate, both sides agree that effective AI deployment requires collaboration, contextual understanding and strong oversight.
For compliance and risk leaders, Shantharam stresses the importance of involving line managers and subject-matter experts early. Successful AI rollouts demand consensus on objectives, clarity on ROI metrics, and pilot programmes that test measurable outcomes. Organisations should track efficiency improvements and productivity gains while recognising cultural shifts—AI adoption must be treated as an ongoing change programme involving training and experimentation.
The 2025 1LOD 1st Line Risk & Control Benchmarking Survey supports this human-centric approach, revealing that 72% of respondents struggle with technology limitations, 70% cite poor data quality for AI models, and 62% face integration challenges with legacy systems. The report urges firms to modernise compliance by automating controls, enhancing horizon scanning, integrating governance systems, and embedding AI-driven predictive analytics.
For more insights, read the full story here.
Read the daily FinTech news
Copyright © 2025 FinTech Global
Copyright © 2018 RegTech Analyst
