GET IN TOUCH
- Please wait...
Artificial Intelligence (AI) has significantly impacted the global financial sector, with Bangladesh slowly adopting this technology. From automating processes to enhancing customer service, several institutions in the country are beginning to leverage AI for operational efficiency. However, greater adoption and optimization are required to unlock more value in Bangladesh, especially in areas like financial inclusion, credit risk management, and fraud detection.
Financial institutions like BRAC Bank and City Bank are utilizing AI-driven chatbots or virtual assistants to improve customer service through quicker responses to customer queries and reducing the burden on call centers. These bots handle basic tasks such as balance inquiries, transaction notifications, and loan applications. Globally, studies indicate that approximately 60% of customers prefer chatbots for routine assistance over waiting for human agents, further highlighting the need for AI integration.
Financial fraud is a critical concern in Bangladesh’s banking sector. AI algorithms are being employed to detect suspicious transactions in real time. Machine learning (ML) models analyze customer transaction patterns to identify anomalies, enabling swift responses to potential fraud.
Traditional credit scoring models often exclude many individuals due to heavy reliance on credit history and formal documentation. AI-based credit scoring systems, like those developed by fintech companies such as bKash and ShopUp, analyze alternative data—like phone usage, transaction behavior, and social media activity—to offer micro-loans to underserved populations enhancing financial inclusion. For instance, bKash reported a 76% productivity boost and a 15% monthly onboarding growth rate with the help of Nimonton and Biponon, two retail AI products developed by Intelligent Machines—an AI firm in Bangladesh.
While still in its early stages, several financial institutions are exploring algorithmic trading systems that use AI to forecast stock market trends and manage investment portfolios. These systems minimize human error and optimize returns through continuous data analysis and learning. The Dhaka Stock Exchange (DSE) is gradually adopting advanced technologies, including trading platforms supported by Nasdaq’s X-stream INET, to improve market operations. Although algorithmic trading is still emerging, there are ongoing efforts to modernize infrastructure and prepare for automated systems.
AI can facilitate financial services for the unbanked populations, particularly in rural areas. Enhanced credit scoring tools, leveraging big data from mobile financial services (MFS), can extend loans to farmers and small business owners who lack formal credit histories.
By leveraging individual customer data, AI can help banks develop hyper-personalized financial products, such as tailored savings plans or investment strategies based on users’ income patterns and spending behavior.
AI can enhance fraud prevention systems by integrating biometric authentication with transaction data analysis. Predictive analytics could also anticipate fraudulent schemes and provide proactive solutions, reducing financial crime risks.
AI tools can automate regulatory compliance processes such as Know Your Customer (KYC) and Anti-Money Laundering (AML), ensuring smooth operations while lowering compliance costs. Additionally, AI solutions can strengthen cybersecurity by identifying vulnerabilities and preventing cyberattacks.
Despite these opportunities, there are a number of challenges that financial institutions must address:
AI has the potential to enhance Bangladesh’s financial industry through improved efficiency, customer experiences, and financial inclusion. To fully harness these benefits, financial institutions must overcome challenges related to data privacy, workforce readiness, and cost. A collaborative approach involving government support, private-sector innovation, and regulatory oversight is essential for responsible AI adoption in the sector.
As the financial landscape evolves, institutions that embrace AI early and strategically are likely to be better positioned to lead the industry, promoting growth and greater inclusion across Bangladesh.
This article was authored by Rafsan Zia, Digital Product Manager and Business Consultant at LightCastle Partners. For further clarifications, contact here: [email protected]
This article was originally published in ExitStack.
Our experts can help you solve your unique challenges
Stay up-to-date with our Thought Leadership and Insights
