The U.S. financial services industry operates on more than 1.2 billion processors that lack any on-device AI governance capability, creating what VectorCertain describes as a "governance vacuum" at the exact point where transactions are most vulnerable. This hardware deficit exists across every segment of financial infrastructure, from EMV smart cards to core banking systems, while AI-enabled fraud losses are projected to reach $40 billion by 2027 according to Deloitte projections.
VectorCertain's AIEOG Conformance Suite analysis found that 97% of the FS AI RMF operates in detect-and-respond mode with virtually zero prevention capability. The company's Legacy Hardware Gap document quantifies the installed base across eight distinct segments, revealing that more than 99% of the 1.2 billion processors have zero on-device AI governance capability. This includes over 1.1 billion EMV smart card chips circulating in the United States, more than 10 million POS terminals processing 80-90 billion card-present transactions annually, 520,000-540,000 ATM controllers, and core banking infrastructure processing $3 trillion in daily commerce through approximately 220 billion lines of COBOL code.
The financial exposure from AI-powered attacks against this ungoverned hardware is accelerating at compound rates. The LexisNexis True Cost of Fraud 2025 study found that U.S. financial institutions now lose $5.75 for every $1 of direct fraud, up 25% from $4.00 in 2021. Applied to the Deloitte $40 billion projection, the true economic impact of AI-enabled fraud by 2027 reaches approximately $230 billion. Deepfake fraud losses reached $410 million in just the first half of 2025, already exceeding all of 2024, with cumulative losses since 2019 approaching $900 million.
VectorCertain's analysis revealed that no regulatory framework governing AI in financial services addresses governance on edge, embedded, or legacy hardware. Every framework implicitly or explicitly assumes cloud-based or server-based AI deployment environments. The FS AI RMF's 230 control objectives focus on software-level AI risks but do not address how a POS terminal with 128 MB of RAM or an EMV smart card with 8 KB of RAM implements AI governance. The NIST AI RMF 1.0 is technology-layer agnostic and does not specifically address hardware constraints, edge computing, or embedded AI.
The company's MRM-CFS technology addresses this gap by deploying micro-recursive neural network ensembles in 29-71 bytes using INT8/INT4 quantization. A complete 256-model ensemble fits in approximately 18 KB with inference latency of 0.27 milliseconds. The deployment requires zero hardware upgrades or new infrastructure and executes on the integer arithmetic units that every one of these 1.2 billion processors already possesses. This enables AI governance to operate at the transaction-processing edge rather than in cloud data centers hundreds of milliseconds away.
IBM's 2025 data shows that organizations using AI-powered security extensively save $1.9 million per breach. Financial services AI spending reached $35 billion in 2023 and is estimated to hit $97 billion by 2027. Visa has invested $3.3 billion in AI and data infrastructure over the past decade, with its Advanced Authorization system preventing an estimated $28 billion in fraud annually. Yet 44% of North American financial institutions still primarily rely on manual fraud prevention processes, and the vast majority of AI capability exists only in centralized cloud environments.
VectorCertain's analysis across regulatory databases, commercial vendors, academic literature, and industry publications found no company explicitly providing AI governance frameworks specifically for edge or embedded hardware in financial services. The company's platform, validated with 7,229 tests and zero failures across 224,000+ lines of code over 22 development sprints, maps directly to the FS AI RMF's 230 control objectives, enabling governance compliance on existing hardware. More information about their approach is available at https://vectorcertain.com.
