According to a report by McKinsey & Company titled “The AI-powered bank: Rewiring for excellence in customer care,” banks are struggling to leverage artificial intelligence (AI) effectively despite significant investments. The report indicates that the issue lies not in the technology itself but in how banks are integrating AI into their outdated operating models. Many banks are automating flawed processes instead of redesigning them, which leads to unfulfilled promises of cost reductions of 30 to 45 percent and improved customer experiences. A critical finding is that banks often attempt to automate customer service without understanding the underlying reasons for customer inquiries, which can exacerbate existing inefficiencies. Furthermore, the report highlights a disconnect between technology teams and business leadership, where technical success metrics do not align with financial outcomes that executives prioritize. Regulatory hurdles also pose challenges to scaling AI solutions effectively. McKinsey asserts that banks must undergo a fundamental transformation in their operations to fully harness AI's potential, warning that success will depend on their willingness to dismantle legacy systems that inhibit strategic value.