HSBC is considering plans to cut up to 20,000 jobs globally over the next three to five years as it accelerates the use of artificial intelligence to improve operations, in what could be the biggest workforce reduction in modern banking.
According to reports, the lender is exploring how AI can reduce reliance on back and middle office roles, with up to 10 percent of its 210,000-strong global workforce potentially affected. Although the bank declined to comment, the proposals are in line with a broader plan under chief executive Georges Elhedery to streamline processes and reduce operational complexity.
In the UK, where HSBC employs around 34,700 people, the equivalent cuts could see around 3,500 roles affected. The bank’s domestic footprint includes retail banking, corporate operations and asset management, close to its London headquarters.
The potential cuts are part of a wider transformation agenda as HSBC seeks to embed productive AI across the organisation. Speaking earlier this year, Elhedery said the bank is rolling out AI tools to all employees, aiming to improve productivity and improve customer-facing services through personalized interactions.
“We want to simplify processes, procedures and policies and reduce complexity,” he said at the time, while emphasizing the role of AI in empowering frontline workers.
The census review began before the recent rise in the Middle East, emphasizing that the move was driven by long-term structural changes rather than short-term economic shocks. Since taking over in 2024, Elhedery has already reduced staff by diversifying and focusing more on HSBC’s core markets, particularly Greater China.
The downgrade will put HSBC at the forefront of an emerging trend across the financial world, where automation is increasingly targeting traditional white-collar roles. Industry estimates suggest that banks could eliminate up to 200,000 positions globally in the coming years as AI systems take over tasks such as compliance checks, document processing and customer onboarding.
Recent announcements from other sectors are strengthening the way forward. Amazon has revealed plans to cut 16,000 roles, and Hewlett-Packard expects to shed up to 6,000 jobs within three years, both citing the benefits of AI. In the UK, Close Brothers this week confirmed 600 job cuts as it uses AI “at speed” to cut costs.
For HSBC, financial benefits are important. The bank reported that payroll debt reached $19.6 billion last year, up 6 percent, and is targeting $1.5 billion in annual cost savings ahead of schedule. AI-driven efficiency is expected to play a key role in achieving those goals.
Pam Kaur, HSBC’s chief financial officer, recently highlighted two benefits of AI adoption, highlighting both revenue opportunities and cost reductions. “We’re focused on the benefits we can get from AI, whether it’s better revenue generation or cost savings,” he said.
The change also reflects a broader shift in HR strategy, as HSBC increasingly embraces a performance-led model where top performers receive the bulk of bonuses, while underperformers are encouraged to leave.
However, the scale of potential job losses raises questions about the speed at which AI can deliver tangible financial returns. A widely cited study last year found that most corporate AI initiatives were yet to materially improve profits, suggesting that expectations may still be ahead of reality.
However, sentiment among major companies seems to have changed. Businesses are now more willing to act on the expected benefits from automation, betting that AI can reshape cost structures without undermining service quality.
For HSBC, the outcome of its negotiations will be closely watched across the financial sector. If implemented, this reduction would not only mark a major restructuring of one of the world’s largest banks, but also mark the point at which AI is transforming work in all countries of the world.
