DHFM-FLM: A Dynamic Hierarchical Federated Learning Mechanism for Financial Models under Client Resource Heterogeneity

Federated Learning (FL) is an emerging distributed machine learning technology. However, in practical applications, it frequently encounters the challenge of client resource heterogeneity. This can result in long wait times or even model training failures during the communication process of FL. To address this problem, we propose a dynamic hierarchical federated learning mechanism for financial models (DHFM-FLM). The local client adopts a dynamic model training design that leverages the property of resource heterogeneity to enhance the performance of the local model. To avoid prolonged wait times for failing clients, a dynamic communication detection design is proposed at three critical junctures. In each round, the model hierarchical reservation communication design is employed to collect models in segments, thus reducing communication congestion and preventing malicious attacks on the communication process. Experiments with heterogeneous computation and communication resources demonstrate that utilizing the DHFM-FLM boosts model performance by approximately 5-8% and reduces communication time by about 15%. Additionally, DHFM-FLM increases the success rate of the FL task by approximately 6%.