Saudi and UAE banks adopt AI, boosting efficiency, decision-making, and security in financial services

The banking industry in Saudi Arabia and the UAE is embracing artificial intelligence (AI) to streamline operations, boost security, and improve customer experiences. Banks like Riyad Bank have established AI-driven initiatives, such as the “Center of Intelligence,” which aims to implement machine learning for better decision-making, personalised services, and fraud detection. AI’s ability to process vast amounts of data quickly and accurately allows financial institutions to identify potential fraudulent activities in real time, replacing slow, human-led procedures.

According to McKinsey’s 2024 report, AI could add up to $340 billion in annual value across global banking, with key impacts on productivity and operational efficiency. This has prompted leading banks in the Gulf to expand their use of AI across various aspects of banking—from handling routine tasks like loan approvals and customer support to analysing data patterns for fraud prevention.

Mazen Pharaon, Chief Digital Officer at Riyad Bank, called AI a “strategic asset” that transforms how financial services are delivered. By accelerating decision-making and enhancing customer satisfaction, AI provides deeper insights into consumer behaviour and preferences. This innovation is particularly valuable as banks seek to meet growing demands for seamless, digital-first interactions.

Fraud detection is one of the most significant advancements enabled by AI. Machine learning algorithms constantly assess transactions for anomalies, making it possible to detect fraud before it impacts customers. Traditional fraud detection techniques, while effective to an extent, often lag due to manual data processing and slower detection times. AI’s role is to anticipate fraudulent actions in real time, bolstering both customer trust and the bank’s resilience against attacks.

In addition to fraud prevention, AI allows for greater personalisation of banking services. By analysing spending patterns and financial behaviours, AI tailors recommendations for loans, investments, and other financial products. This level of personalisation boosts customer satisfaction and fosters loyalty while improving banks’ overall performance.

With AI taking on time-consuming and repetitive tasks like compliance checks, loan approvals, and account management, human employees can focus on higher-level, value-driven roles. This transformation helps banks reduce operational costs while maintaining a high level of service delivery.

The UAE’s Mashreq Bank, along with other leading Gulf financial institutions, has embraced this AI wave to stay competitive in the rapidly evolving financial technology landscape. Mashreq has incorporated AI into everything from customer service chatbots to in-depth risk assessments, providing clients with enhanced convenience and security.

AI’s influence in banking is only expected to grow. As Gulf nations position themselves as leaders in digital transformation, their banking sectors will continue to rely on AI-driven innovations to maintain efficiency and offer future-ready financial solutions. By 2030, AI is projected to have transformed almost all facets of banking, from fraud detection to customer service, creating a more secure, efficient, and responsive industry.