While Pakistan’s banking sector rapidly adopts artificial intelligence to improve efficiency, strengthen risk management, and reduce costs, State Bank of Pakistan Governor Jameel Ahmad has highlighted the importance of retaining human oversight in sensitive areas. Speaking at the sixth AlBaraka Forum Regional Conference – Pakistan 2026 on “Islamic Economy in the Digital Age – Innovation Within The Framework of Compliance,” Ahmad stressed that human judgment is critical in loan approvals and customer due diligence.
“Human oversight remains essential to monitor AI-driven decisions, especially in sensitive areas such as credit approval and customer due diligence,” he said. The central bank chief, however, acknowledged the transformative impact of AI and other technological advancements on the financial sector, noting that SBP’s policy interventions, digital financial service expansion, and growing consumer adoption have significantly advanced the national payment ecosystem.
Mobile banking apps, branchless banking, wallets, and electronic money institutions account for 78% of total digital retail transactions. Ahmad pointed out that over 70% of people globally use at least one digital financial service, and more than 80% are willing to shift to digital banking, signaling a major change in consumer behavior.
Highlighting the integration of Islamic finance with digital banking, Ahmad explained that Shariah-compliant finance links financial activity to the real economy, emphasizing fairness, transparency, and shared prosperity. “Islamic finance is not merely conventional banking with different parameters; it is a deliberate effort to build an inclusive ecosystem serving the diverse financing needs of the wider community,” he said.
Digital innovation, according to Ahmad, is a means to expand financial inclusion. Technology can lower costs, reduce geographic barriers, and provide access to finance for small businesses, farmers, and women entrepreneurs who have traditionally remained underserved. SBP has granted principle approval to five digital banks since 2022, with one already offering Islamic operations and another in the pilot phase.
He cited initiatives like Raast, Assan Mobile Account, digital onboarding frameworks, and the Roshan Digital Account as examples of expanded formal financial access. Ahmad also cautioned that technology might replicate conventional financial models digitally, emphasizing the need for robust data protection frameworks and high regulatory standards to align digital innovation with Shariah principles.
AlBaraka Forum Secretary General Yousef Hassan Khalawi echoed the importance of aligning innovation with values, compliance, and institutional integrity. “The challenge is no longer whether the Islamic economy can be digitized, but how this transformation is managed. Sustainable digital Islamic finance requires strong institutional frameworks and engagement from scholars, regulators, and industry leaders,” he said.
AlBaraka Bank Pakistan CEO Muhammad Atif Hanif added that integrating digital solutions with Islamic principles allows the banking sector to engage broader segments of society, creating a more inclusive, accessible, and trusted financial system.
SBP’s approach underscores a balanced strategy: leveraging AI and digital innovation to expand financial services while ensuring human judgment and Shariah compliance remain central to decision-making.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem.