The Federal Reserve System has established a new generative artificial intelligence “incubator” program to test out the emerging technology’s potential applications.
Sunayna Tuteja, the Federal Reserve System’s first-ever chief innovation officer, said the Fed needs to start putting generative AI technology into action, with responsibility and ethics at the forefront of their efforts.
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“This is one of those technologies where you have to think but you also have to do, so how do we create a framework that enables us to do that?” Tuteja said at a conference hosted by FedScoop and Microsoft in Arlington, Virginia earlier this month.
“We’ve got to put hands on keys. This is not a theoretical exercise,” Tuteja added. “So how do we create the right guardrails and safe spaces within our organization that enables and empowers as many of our colleagues to really put hands on keys and start to think about the value of this technology on the businesses that they lead?”
The Federal Reserve is looking at potentially using AI to analyze payment system data and data related to supervision and regulation activities. Tuteja said applying the right AI models, especially in regards to payment system data, could help the Fed better understand its customers’ behavior and make more informed business decisions.
As AI technologies have grown in popularity in recent years, concerns about the workforce have emerged, but Tuteja asserted that the Fed’s use of AI is focused on “augmenting” humans, not replacing them.
“Our thesis is not that AI or generative AI is going to be a replacement, but more so that it will play the role of augmentation and complement. So in a way that humans now have more time and space to do the higher order work,” she explained.
The Federal Reserve’s new incubator program aligns with the objectives and goals outlined in President Biden’s recent landmark executive order on AI.