First National Bank (FNB) is exploring the use of quantum computing to enable the development of breakthrough customer-centric products and services, in efforts to boost customer relationship management.
Regarded as one of the local banks at the forefront of digital innovation, FNB has collaborated with the University of KwaZulu-Natal’s School of Chemistry and Physics, to conduct research aimed at looking at the best approach to apply the principles of quantum theory, which is increasingly attracting the interest of financial services firms across the globe.
Quantum computing is poised to upend industries from finance, telecommunications and cyber security, to advanced manufacturing, medicine and beyond.
In the financial sector, global banks such as Barclays, Goldman Sachs, JPMorgan and Citigroup are ramping up research efforts into practical applications of quantum finance to unravel the potential of this revolutionary new computing technology.
In an interview with ITWeb, Dr Mark Nasila,chief analytics officer at FNB’s Chief Risk Office, explained that applying emerging quantum technology to financial problems, especially those dealing with constrained optimisation, is proving to be hugely advantageous for the finance sector, requiring a shift of computing paradigm.
“When you look at where the world is going, things are changing at exponential speeds and the world is moving towards proving supremacy in technology beyond emerging tech such as artificial intelligence and machine learning.
“Quantum computing makes use of quantum phenomena, such as quantum bits, superposition, and entanglement to perform data operations.
“Customer needs are not only changing, they are immediate and becoming more complex, and quantum computing can help with understanding customer behaviour, managing relationships, enabling the development of global customer-centric solutions, digital customer onboarding verification, biometric transacting and authentication, cyber crime prevention, and financial crimes monitoring and compliance.”
Quantum computing brings an enormous advantage over current emerging technologies, due to its magnitude of larger than traditional computers, including those perceived as immensely powerful, he adds.
Through doubling the power of a traditional computer, the power of a quantum computer can be approximately doubled each time only one qubit is added.
“In financial fraud, cyber criminals are already deploying emerging technologies such as AI and machine learning, helping them to be ahead of their game. Quantum computing has the potential to enable organisations and security firms to be ahead of the criminals, predicting and identifying trends and methods of money laundering, tracking the trail of Bitcoin theft and other areas of cyber crime. In terms of credit risk management, quantum computing uses credit scoring models designed around more than 10 000 variables, which means the credit reports are much more defined, accurate and provide a better picture of the customer’s credit history, risk type and digital footprint.”
While FNB is still at research phase, Nasila pointed out the use of big data and alternative data will be key to the success of the bank’s computing strategy, as it aggressively repositions itself for a data-driven, platform-based future, in an effort tohelp customers with contextual solutions.
“We want to pursue a sustainably-developed innovative strategy that will build relationships with other organisations, to provide solutions focusing beyond financial services. These include functions like influencing the fight against women and child abuse by identify someone who’s most likely to abuse a child; and in healthcare being able to predict and identify disease-prone genes in people before the sickness manifests.”
Desire to achieve ‘quantum supremacy’
Also speaking to ITWeb, professor Francesco Petruccione, professor of Theoretical Physics at the School of Chemistry and Physics at the University of KwaZulu-Natal and South African research chair in quantum information processing and communication, noted that competition for achieving “quantum supremacy” is expected to intensify across the globe.
“A new quantum era is knocking at the doors of secure communication and high-performance computing. In January 2018, a satellite link was used to exchange data encrypted with quantum cryptography. This is the beginning of the future secure ‘quantum Internet’. Additionally, in October last year, a quantum computer outperformed a classical one for a particular, although not very practical, computation. Real-world applications of quantum computing are imminent.”
Quantum computing is also expected to disrupt the energy sector, with the technology attracting the attention of utilities industries that want to tap its potential in renewable energy systems optimisation, Petruccione continued.
“The mining sector is also working on critical problem-solving methods to addressing complexities in their processes and increasing production speeds, while agricultural companies are looking at quantum smart farming methods to improve productivity.”
Amira Abbas, researcher in the Quantum Research Group at the University of KwaZulu-Natal and researcher at IBM's quantum computing research lab in Zürich, explained the use of quantum computing does not seek to replace emerging technologies such as AI and machine learning.
“There are physical limits associated with classical computers which we seek to evade by entering the realm of quantum computing. Whilst quantum computers are believed to be powerful devices that offer a computational advantage, the ones available today are still quite limited in their capability and the idea is to think about how to use quantum computing to leverage our current technologies.
“The great thing about quantum computing is that it works on principles of physics, meaning it focuses on the principles of quantum theory, which deals with modern physics that explain the behaviour of matter and energy of an atomic and subatomic level.”
Within the next few years, heavy investment is expected to flow towards improving quantum computers and supporting technologies in many areas, in various sectors across the globe, in an attempt to achieve “quantum supremacy” ‒ the moment when a quantum computer does something that a traditional, binary computer cannot perform, driven by the desire to solve complex problems and better understand how the universe works.
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