BoT eyes AI to strengthen financial sector efficiency
DAR ES SALAAM: THE Bank of Tanzania (BoT) has urged financial institutions to embrace Artificial Intelligence (AI) and data-driven innovation to improve decision-making, strengthen risk management and enhance operational efficiency while delivering safer and more customerfocused financial services.
BoT Governor, Mr Emmanuel Tutuba, said recently that AI was creating new opportunities for banks and central banks to strengthen their operations, improve service delivery and respond more effectively to changing financial sector needs amid rapid technological advancement.
Speaking yesterday during the opening of a conference organised by the Bank of Tanzania Academy in Mwanza, Mr Tutuba said financial institutions had made significant progress in digital transformation through computerised systems, mobile and internet banking and digital data storage.
“AI is changing how banks and central banks perform their functions,” he said, emphasising the need for financial institutions to explore its potential in strengthening their operations and improving service delivery.
He said while digital transformation had enabled institutions to automate various processes and expand access to financial services, AI represented a further advancement by enabling systems to analyse large volumes of information, identify patterns, forecast trends and support more informed decisions.
The technology, he added, could also help financial institutions improve their ability to identify potential risks, detect suspicious transactions and enhance the efficiency of internal processes.
The conference, held under the theme “Beyond Digital Transformation: How AI is Transforming the Operations of Banks and Central Banks,” brought together academics, financial sector professionals, executives and policymakers to discuss opportunities and challenges associated with the emerging technology.
Discussions focused on how AI could contribute to strengthening the financial sector, particularly in improving institutional performance, enhancing financial supervision and supporting innovation as banks explore ways to integrate emerging technologies into their operations.
Mr Tutuba said the central bank had begun laying the foundation for the application of AI and datadriven innovation through the establishment of an AI and Data Innovation Hub.
The initiative is intended to provide a platform for research, experimentation and the development of innovative solutions that can support the Bank’s functions and broader financial sector development.
He said the central bank had also approved policies and strategies to guide the adoption of the technologies, with particular emphasis on data confidentiality, accountability and human oversight.
These safeguards are important in ensuring that the adoption of AI strengthens institutional performance without compromising public confidence, data security and responsible decision-making.
To accelerate the process, BoT had signed cooperation agreements with five higher learning and research institutions in the country to promote research, experimentation and innovation in AI applications.
The partnerships are expected to support the development of AI-based solutions in several areas, including economic research, financial sector supervision, currency management and payment systems.
The collaboration is also expected to strengthen the link between academic research and practical applications, enabling financial institutions to benefit from locally developed knowledge and technological solutions.
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As financial services become increasingly technology-driven, the conference provided an opportunity for stakeholders to examine how institutions could move beyond basic digitalisation towards more intelligent, efficient and resilient operating systems.
The discussions also highlighted the importance of balancing technological advancement with appropriate governance frameworks to ensure that AI adoption contributes to a secure, inclusive and sustainable financial sector.
