Use of Artificial Intelligence in the Banking Industry: A Case Study of Pakistan
DOI:
https://doi.org/10.47067/ramss.v7i4.394Keywords:
Artificial Intelligence, Pakistan Banking Sector, Customer Service, Fraud Detection, Operational Efficiency, Data Privacy, Automation Challenges, Regulatory ComplianceAbstract
This study investigates the adoption and impact of Artificial Intelligence (AI) in Pakistan’s banking sector, with a focus on Habib Bank Limited (HBL), Faysal Bank, and Bank Alfalah. The objective is to understand the extent to which AI technologies have transformed core activities within customer service, operations, fraud detection, and risk management in these banks. Data were collected from semi-structured interviews with ten respondents, selected based on their experience with AI implementation. This qualitative methodology allows for in-depth insights into the functionality and challenges associated with AI in banking. Results reveal that AI has notably improved operational efficiency by streamlining risk management and enabling real-time fraud detection. Additionally, AI-driven chatbots and virtual assistants have enhanced customer experiences by offering faster and more personalized services. Despite these benefits, the study identifies significant challenges, particularly regarding data privacy and regulatory compliance, as well as the need for human resources to adapt to AI-enabled tools. Key pressures in the industry include building capabilities to work alongside AI while addressing concerns over automation. To maximize the advantages of AI, the study emphasizes the need for comprehensive policies that balance technological adoption with ethical considerations, data security, and staff training. Strategic planning in Pakistan’s banking sector will be crucial to harnessing AI’s potential while managing its risks.
References
Ahmed, B., & Ramesh, M. S. (2024). Artificial Intelligence and Future HRM Practices: A Case of Pakistan Business Sector. Journal of Development and Social Sciences, 5(2), 395–405.
Ahmed, S. I., Khalid, M. A., & Ghafoor, S. (2024). Artificial Intelligence Adoption in Developing Countries: Exploring the Use Cases and Challenges for Using AI In Banking Services in Pakistan. Journal of Business and Management Research, 3(1), 303–309.
AL-Dosari, K., Fetais, N., & Kucukvar, M. (2024). Artificial intelligence and cyber defense system for the banking industry: A qualitative study of AI applications and challenges. Cybernetics and systems, 55(2), 302-330.
Choithani, T., Chowdhury, A., Patel, S., Patel, P., Patel, D., & Shah, M. (2024). A comprehensive study of artificial intelligence and cybersecurity on bitcoin, cryptocurrency, and banking systems. Annals of Data Science, 11(1), 103–135.
Dhyani, R., Gupta, L., Tomar, D., & Srivastava, A.(2024). The Role of AI-Based Green Banking Technologies in Ensuring Bank Stability: The Moderating Influence of Climate Change.
Farooq, S., & Pervez, S. (2024). Customer Experience Of Artificial Intelligence In Pakistan: The Oldaa Model. Kurdish Studies, 12(4), 795-806.
Hidayat, M., Defitri, S. Y., & Hilman, H. (2024). The Impact of Artificial Intelligence (AI) on Financial Management. Management Studies and Business Journal (PRODUCTIVITY), 1(1), 123-129.
Iqbal, F., Nawaz, S. A., Shah, R. A., Gujjar, A. M., Ejaz, A., Dilbar, Z., & Aslam, T. (2024). Impact of Cyber Security Measures in the Digital Banking Sector of Pakistan. Journal of Computing & Biomedical Informatics.
Javaid, H. A. (2024). How Artificial Intelligence is Revolutionizing Fraud Detection in Financial Services. Innovative Engineering Sciences Journal, 4(1).
Kanaparthi, V. (2024). Transformational application of Artificial Intelligence and Machine learning in Financial Technologies and Financial services: A bibliometric review. arXiv preprint arXiv:2401.15710.
Liu, T. L., Naveed, M. M., Mustafa, S., & Naveed, M. T. (2024). Analyzing the impact of digital technology diffusion on the efficiency and convergence process of the commercial banking industry of Pakistan. Humanities and Social Sciences Communications, 11(1), 1-27.
Maseke, B. F. (2024). The transformative power of artificial intelligence in banking client service. South Asian Journal of Social Studies and Economics, 21(3), 93-105.
Naeem, M., Siraj, M., Abdali, A. S., & Mehboob, A. (2024). The Impact of Investment in AI on Bank Performance: Empirical Evidence from Pakistan's Banking Sector. KASBIT Business Journal, 17(1).
Nawaz, H., Maqsood, M., Ghafoor, A. H., Ali, S., Maqsood, A., & Maqsood, A. (2024). Huawei Pakistan Providing Cloud Solutions for Banking Industry: A Data Driven Study. The Asian Bulletin of Big Data Management, 4(1), 89–107.
Owolabi, O. S., Uche, P. C., Adeniken, N. T., Ihejirika, C., Islam, R. B., & Chhetri, B. J. T. (2024). Ethical implication of artificial intelligence (AI) adoption in financial decision making. Computer and Information Science, 17(1), 1-49.
Pattnaik, D., Ray, S., & Raman, R. (2024). Artificial intelligence and machine learning applications in the financial services industry: A bibliometric review. Heliyon.
Waleed, M., Bashir, F., & Nasim, I. (2023). Artificial Intelligence Revolution: Shaping the Future of Millennials. Pakistan Journal of Humanities and Social Sciences, 11(4), 4261–4274.
