Donald Trump's first three months in office have been accompanied by a dizzying array of tariff announcements that often change by the day, stressing compliance and supply chain management strategies.
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"AI is transforming compliance from a lagging function into a proactive capability," Amit Levi, chief product officer of corporate payments company Pagaya Global, told American Banker.
Pagaya has noticed regulatory change cycles such as tax rule updates or sanctions screening that used to take weeks can be resolved in under 48 hours by using machine learning.
A hand from AI
Trump's tariffs and subsequent trade war have clouded the economic outlook for
As real-time payments and other forms of digital finance have advanced, so has the need to upgrade risk. The trade war adds another factor to an existing technology evolution. For example, AI systems can perform real-time cost simulations, Levi said.
"The future of global payments will hinge not just on speed or cost, but on how fast and correctly you can adapt to change," Levi said. AI has already demonstrated its ability to sift through substantial amounts of data and changes to rules. The technology has been added to sanctions screening for employee onboarding, according to Levi, noting that in 2023 alone, the U.S. government added nearly 5,500 names to restricted party lists maintained by the Office of Foreign Assets Control, or OFAC.
By incorporating AI-driven screening across vendors and payment channels, Pagaya can dynamically block or reroute transactions involving newly sanctioned entities in near-real time, Levi said, adding that implementing AI-based compliance mapping reduced the average time to incorporate a local tax rule change from three to four weeks to under five business days.
With regulatory frameworks such as tariffs, sanctions and data compliance not only changing rapidly but also fragmenting across jurisdictions that are now increasingly less aligned, being able to respond quickly becomes challenging, David Bender, head of global research at Hence Technologies, told American Banker.
Hence recently launched Hence Global, an AI-powered tool that helps companies track risk and produces suggestions on how to mitigate that risk. It also generates analysis on geopolitical and other rapidly changing factors.
The potential for AI to support faster, more adaptive responses to regulatory changes is promising, particularly in industries like financial services where the stakes are high for both compliance and customer trust,
"But speed shouldn't come at the expense of thoughtful policy analysis or public accountability," Saema Somalya, executive vice president of legal and risk for payment firm Remitly, told American Banker.
How can AI help with tariffs
Even with economic uncertainty, AI is drawing funding. Thirty-one percent of financial professionals will increase AI investments between 10% and 19% in 2025, according to a March report from
This investment plus early deployments can build a base to use AI to manage the impact of rapid price changes, or to change shipping or pricing to meet a new tariff or trade mandate.
One of Gen AI's early use cases has been to drive efficiencies in compliance by supporting financial institutions with document management, gap analysis, reporting and other tasks, Zil Bareisis, a director at Celent, told American Banker.
Specialized AI platforms built to address the unique challenges in communication and customer engagement in financial services can be tailored to the bank's brand voice, corporate policies and industry requirements, Bareisis said.
"Not only can the platforms generate content, but also analyze customer feedback, test communication clarity, and provide actionable insights to improve customer outcomes," Bareisis said. "They can also help banks ensure their promotional messages comply with all regulations."
Pretrained large language models are good at understanding and responding to natural language queries from business users, citizen data scientists, analysts, investigators and others who are not intimately familiar with technical enterprise, Meng Liu, a senior analyst at Forrester Research, told American Banker.
Gen AI can help investigators of all experience levels to receive relevant and appropriate messages or instructions by intelligent alert routing and queue definitions; understand context (related transactions and entity interrelationships) in alerts by providing natural language responses and narratives automatically or in response to natural language prompts; and create 80% to 90% of regulatory filing narratives and sharply decrease the need for human review, Liu said.
"AI can't make the decision, but can give humans some points and information about what they can do," Mike Upchurch, vice president of data strategy for finance services and insurance at Domino Data Labs, told American Banker.
