The rise of intelligent banking: Unifying fraud, security, and compliance in the era of AI

Traditional threats have evolved dramatically. Generative AI is enabling new forms of document forgery, identity spoofing, and behavioral manipulation all at a scale and speed that overwhelms legacy controls. Fraud is no longer isolated to transactional abuse; it’s cross-channel, automated, and increasingly evasive.

Simultaneously, regulatory mandates like DORA, NYCRR 500, GLBA, and PSD2/3 are enforcing stricter expectations for operational continuity, real-time telemetry, incident response, and auditability. These aren’t just check-the-box requirements; they require institutions to prove, not just promise, their resilience.

Meanwhile, customer expectations are skyrocketing. IDC’s data shows over 80% of banking customers expect easy-to-use, self-service fraud alert tools. Many say they would switch providers if a competitor offered clearer, stronger protections. Security and transparency are now brand drivers — they directly influence net promoter scores (NPS) and loyalty.

At the same time, fintechs and digital-native banks are setting new benchmarks for agility, trust, and innovation.Their ability to deliver seamless, secure digital experiences — unencumbered by legacy systems — is reshaping the competitive landscape.

Despite modernization efforts, many financial institutions still operate with fragmented legacy infrastructure and disjointed tools across fraud, IT, security, and compliance. This fragmentation slows detection, creates visibility gaps, and opens the door for attackers to exploit weak points.

Operational complexity is now a core risk. Hybrid cloud environments, distributed teams, third-party integrations, and data silos all compound the challenge. To respond in real time, institutions need unified platforms that integrate detection, response, and investigation.

At Elastic, we’re helping financial institutions transform fragmented defenses into a unified, operational fabric built for speed, scale, and adaptability. Our Search AI Platform combines powerful search, observability, and security capabilities to turn massive, disjointed datasets into real-time intelligence.

Here’s how.

Our observability solution delivers full-stack visibility across hybrid and multicloud environments, enabling teams to correlate telemetry — logs, metrics, traces — into a single view of operational health. By supporting OpenTelemetry (OTel) and the Elastic Common Schema (ECS), we help institutions spot issues early, reduce MTTR, and ensure auditability across systems critical to uptime and compliance.

Our security solution unifies SIEM, endpoint protection, threat analytics, and GenAI-driven investigation in one solution. Elastic AI Assistant for Security translates noisy alerts into actionable insights, helping lean teams stay ahead of lateral movement, privilege misuse, and policy violations. Elastic Attack Discovery surfaces patterns that manual triage would miss.

Extend these same capabilities to detect account takeovers, identity abuse, synthetic users, and transaction fraud in real time. By applying machine learning to behavioral and contextual data like device fingerprints, login patterns, and session anomalies, financial services companies can connect fraud and security intelligence on one platform.

Together, these capabilities help unify security, fraud, IT, and compliance teams — eliminating tool sprawl, streamlining workflows, and reducing cost and complexity.

Importantly, fraud prevention and information security are no longer separate disciplines. Both rely on shared telemetry, behavioral analytics, and real-time anomaly detection. Unified platforms provide a strategic advantage, helping institutions address both threats simultaneously while reducing duplication of effort.

Cloud-native infrastructure is also essential. By centralizing data from across environments and enabling real-time ingestion, modern cloud platforms simplify compliance and accelerate response. Cloud-based controls also help standardize policy enforcement while ensuring visibility into distributed systems and users.

As the IDC report notes, this transformation doesn’t have to be a massive overhaul. Many of our customers start with a single use case, such as PCI audit readiness, account takeover detection, or cloud workload monitoring, and expand iteratively, compounding value as they go.

What starts as a security deployment becomes the backbone for fraud detection. What begins in IT operations grows into a compliance framework. This modular, integrated approach reduces TCO, strengthens defenses, and accelerates response across silos.

Intelligent banking isn’t just a tech evolution; it’s an organizational one. It’s about connecting people, processes, and data into a single, adaptive system that can respond to threats, meet regulatory demands, and deliver exceptional customer experiences in real time.

As IDC concludes in their report, this shift is not just technological; it’s managerial and operational. Financial institutions must break down functional silos, align stakeholders, and build resilience through shared infrastructure and intelligent automation.

With Elastic’s Search AI Platform and our deep partnership with AWS, financial institutions can meet today’s challenges while building the data foundation for tomorrow’s innovation. Whether you're protecting against AI-driven fraud, enhancing audit readiness, or modernizing customer trust, Elastic and AWS help you operate with confidence.