After four decades of research, marked by intermittent breakthroughs and periods of market stagnation, murmurings of functional quantum computing within the next ten years are growing louder.
Quantum computers are machines that use the properties of quantum physics to store data and perform computations.
Quantum computing in financial services, or quantum finance, integrates principles from quantum physics and quantum computing with financial services to solve complex problems more efficiently. It uses the unique properties of quantum computing, like superposition, interference, and entanglement, to potentially revolutionise areas like risk management, derivatives pricing, fraud detection, asset valuation, and financial crash forecasting.
Quantum finance is a swiftly evolving field with the potential to transform the financial industry by improving efficiency, accuracy, and security. Illustrative of this rapid progress was the announcement on September 25, 2025, that HSBC and IBM had applied quantum computing to real-world bond trading, demonstrating a 34% accuracy improvement in predicting the likelihood of a trade being executed at a quoted price. This announcement is the latest development in a collaboration between the two companies that started in 2022.
From mainframes to qubits, IBM consolidates its quantum legacy
IBM pioneered superconducting quantum computing, an architecture that relies on circuits cooled to a few thousandths of a degree above absolute zero. These cryogenic temperatures enable qubits to exist in multiple states at once. Superconducting quantum computing boasts high fidelities and relatively simple scalability compared to other architectures as key attributes. GlobalData expects the superconducting architecture to reach widespread commercialisation by 2030. Other key players exploring superconducting quantum computing include Google and Rigetti.
Scalable quantum computing has been fiendishly difficult to achieve, contributing to the quantum computing market’s fluctuations over the years. IBM has been engaged in quantum computing for more than 30 years and launched the world’s first publicly accessible quantum cloud in 2016. IBM has sought to build an ecosystem of users, researchers, and industry partners and has spearheaded advances in superconducting qubit design, error-mitigation techniques, and open-source tools such as Qiskit.
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By GlobalDataDespite decades of development by IBM and its peers, quantum computing has been subject to much cynicism concerning its practicality and commercialisation potential. IBM’s latest announcement, following its trial with HSBC, should go a long way towards dispelling much of that pessimism. The trial, performed on IBM’s highest performing 156-qubit Heron processor, demonstrated that a hybrid quantum-classical approach improved price predictions of algorithmic bond trading substantially better than classical approaches alone. These predictions were superior in their ability to assess the future market value of a bond, a result that will increase investor trust in automated trading systems.
HSBC pulls ahead in the financial services race
Algorithmic bond trading uses advanced computer programs and models to predict bond prices, yields, and market movements. Prediction accuracy is difficult to obtain, considering bond markets can be less liquid, sensitive to sudden economic events, and affected by complex risk factors. Improving the prediction accuracy of algorithmic trading is paramount to improving market efficiency, managing risk, and giving investors an edge in a fleeting financial landscape where every second and basis point counts.
Quantum computing, therefore, serves a valuable purpose in elucidating market dynamics, processing vast amounts of complex financial data, and handling multi-dimensional and combinatorial problems, ultimately solving problems out of reach of classical computers.
HSBC is not alone in its quantum pursuits. Along with JPMorgan Chase and Goldman Sachs, it is in the vanguard of exploring qubits’ potential for the finance industry. The three banks are at the top of The Quantum Insider’s Quantum Innovation Index for finance, created in February 2025. JP Morgan has worked with Quantinuum to investigate and publish papers on topics ranging from option pricing to portfolio optimisation using quantum computers. Meanwhile, Goldman Sachs has collaborated with UK start-up Quantum Motion to explore how quantum computing applies to options pricing algorithms.
Market competition is intensifying on two fronts – between banks and investment companies racing to use quantum computing for better pricing, risk, and market insights, and between quantum hardware vendors competing to develop the most reliable and scalable systems. These parallel rivalries will likely produce a steady stream of similarly noteworthy announcements about quantum partnerships and real-world applications.
Quantum computing promises practical deployments across numerous sectors
Quantum computing is breaking ground beyond the world of financial services. In the pharmaceutical sector, quantum computers are being trialed to simulate the behaviour of molecules more accurately and realistically than classical computers.
The level of precision modelling uniquely delivered by quantum computers is necessary to make leaps in personalised medicine and potentially shave years and billions of dollars off the drug discovery process while yielding far superior drug therapies. In June 2025, Astrazeneca announced, in partnership with IonQ, Nvidia, and Amazon Web Services, that a 20x improvement in speed could be achieved with hybrid quantum-classical accelerated simulations of chemical transformations compared to previous classical methods.
In the automotive sector, companies are betting on quantum computing’s ability to transform battery chemistries. Driven by escalating competition in the electric vehicle market, automakers are contending to demonstrate the most efficient, stable, and durable batteries available. For instance, in 2024, Volkswagen partnered with IQM Quantum Computers to apply quantum computing simulations to the reductive decomposition of ethylene carbonate, a chemical process that degrades the stability of lithium-ion batteries. Meanwhile, Mercedes-Benz has partnered with PsiQuantum, which produces photonic quantum devices, to develop resource-efficient quantum computing, with one goal being the simulation of battery additives to increase the battery current. The full potential of quantum computing is yet to be unlocked.
However, prominent industries, including financial services, pharmaceuticals, and automotive, are beckoning it forward. As quantum hardware and software advance, these sectors, and many others, will increasingly harness their capabilities, ushering in a new era of innovation and opportunity.
