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HSBC explores quantum computing for finance sector

UK banking giant works with quantum computing specialist to explore the technology’s potential in the finance sector

HSBC is running quantum computing projects to assess the technology’s potential in areas including cyber security, fraud detection and natural language processing in the banking sector.

Working with quantum computing specialist Quantinuum, the bank will explore opportunities to use quantum computers in near and long term.

HSBC and Quantinuum will initially explore the use of quantum computing in cybersecurity to produce unpredictable cryptographic keys, before work turns to quantum machine learning and its potential in preventing fraud as quantum natural language processing.

Philip Intallura, global head of quantum technologies at HSBC, said partnership will explore the further applications of quantum technology in the financial services sector.

“Our collaboration provides us a great opportunity to access cutting-edge quantum hardware and take our use cases to a truly transformational level,” said Intallura. “We are looking forward to seeing the results of our joint work and [to bringing] long-term value to the bank.”

Ilyas Khan, chief product officer at Quantinuum, said: “As we move towards quantum computers that simply cannot be simulated by classical computers, customers will benefit from significant value in terms of innovation and knowledge.”

Quantum computers will be able to make calculations that traditional computers are fundamentally unable to do. If practical, they would mark a leap forward in computing capability far greater than that from the abacus to a modern computer.

In March last year, HSBC embarked on a three-year collaboration with IBM to explore how quantum computing can benefit its business. The agreement gave it access to expertise and quantum computing systems. At the time, HSBC said it expected to apply quantum computing to pricing and portfolio management, risk and fraud detection and prevention, and will be used to support its environmental goals.

HSBC is not alone in exploring potential uses for quantum computing in the finance sector. A test done by Spanish bank BBVA in 2020 on the use of the technology for investment portfolio optimisation showed that it could be considerably faster when there are more than 100 variables in a calculation.

Meanwhile, Dutch bank ABN Amro is working with researchers to explore how the technology can be used to secure online banking, and to prove that quantum key distribution can be used to secure data traffic.

Five application areas for quantum computing

  1. Drug and materials discovery: Untangling the complexity of molecular and chemical interactions leading to the discovery of medicines and materials.
  2. Supply chain and logistics: Finding the optimal path across global systems for ultra-efficient logistics and supply chains, such as optimising fleet operations for deliveries during the holiday season.
  3. Financial services: Finding ways to model financial data and isolating key global risk factors to make better investments.
  4. Artificial intelligence (AI): Making facets of AI, such as machine learning, much more powerful when datasets can be too big, such as searching images or video.
  5. Cloud security: Making cloud computing more secure by using the laws of quantum physics to enhance private data safety. 

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