Can banks use AI under GLBA?
Yes. GLBA does not prohibit AI; it makes you responsible for safeguarding customer information wherever it goes. With generative AI left outside the agencies' 2026 model-risk guidance, examiners read your controls — so the defensible position is inference inside your own perimeter, with a validation file to match.
What the examiner will ask for
A model inventory, a validation file, defined human review, change control, and evidence that customer NPI stayed inside the boundary your policy describes. None of that is exotic; all of it is harder to produce when inference happens in a vendor's cloud.
Why on-premise simplifies model validation
Model weights, prompts and inference logs sit on hardware inside the perimeter that has already been examined. Version changes are yours to schedule and document, not a vendor's to announce.
The on-premise answer
A private model over your policy library and credit files, logging to your systems, with the control narrative and network diagram handed over as part of the install.
Three ways to deploy, side by side
| The question | Consumer cloud AI | BAA / enterprise cloud | Handistack on-prem |
|---|---|---|---|
| Where client data goes | Bad: The vendor's cloud | Qualified: The vendor's cloud, contract-bound | Good: Stays on hardware you own |
| Trained on your content | Bad: Yes, unless you opt out | Qualified: No — by contract | Good: Never. No upstream to train |
| Retention of prompts & files | Bad: Vendor policy, human review possible | Qualified: Configurable, vendor-controlled | Good: Your policy, your disks |
| BAA / DPA in place | Bad: Not available | Good: Available | Good: Not needed — no third party |
| Audit trail you control | Bad: None | Qualified: Vendor console | Good: Your log store and SIEM |
| Cost shape | Qualified: $20–30 per seat / mo | Bad: $60+ per seat / mo | Good: One-time build, one flat retainer |
| Works with the internet down | Bad: No | Bad: No | Good: Yes |
Your examiner reads your controls, because the rulebook isn’t written yet.
We build, install and maintain the private system that makes this a non-question — inside your building, owned by you, with the control documentation for your file.