Experts have called for stronger data governance across Pakistan’s banking sector as rapid digitalization increases the volume of financial and customer information being generated by banks and other financial institutions. The discussion comes as digital payments continue to expand across the country, with State Bank of Pakistan (SBP) data showing that retail payments reached 9.1 billion transactions worth Rs612 trillion during calendar year 2025. Digital channels accounted for 88% of these transactions, including 6.2 billion payments processed through mobile applications. At the same time, workers’ remittances reached $41.6 billion during FY26, further increasing the importance of secure and well-governed financial data systems. Experts say the growing volume of information creates opportunities for banks to improve fraud detection, compliance and customer services, but also raises questions around data quality, privacy, consent and accountability.
Muhammad Ghazali Aqeeq, a Governance, Risk and Compliance (GRC) expert, has highlighted privately controlled artificial intelligence environments as one potential approach for banks dealing with increasingly complex datasets. Under this model, banks could use AI within controlled institutional environments to analyze operational information while maintaining oversight over how data is accessed and processed. Such systems could bring information related to fraud management, sanctions screening, trade finance and other banking functions into a more connected framework. The objective would be to enable institutions to convert large volumes of operational information into decisions that can be reviewed and supported through clear audit trails. For banks, this could be relevant to regulatory reporting, internal controls and risk management, particularly as digital transactions become a larger part of everyday financial activity.
The issue also has implications for financial inclusion. Pakistan’s Financial Inclusion Index stood at 58.1 in the SBP’s 2024 assessment, while the country had more than 19,800 bank branches and around 756,480 branchless banking agents. This expanding financial infrastructure brings more consumers into formal financial services but also increases the amount of customer data institutions must manage responsibly. Experts have pointed to the potential use of controlled AI systems to identify patterns in customer complaints, fraud and other operational issues, allowing banks to respond to emerging problems more quickly. Such applications would require appropriate controls to ensure that automated systems do not replace human oversight in decisions with significant financial or regulatory consequences. Data quality and customer consent would also remain important considerations as financial institutions expand their use of AI.
Pakistan’s regulatory environment is also beginning to address the increasing role of technology in financial services. The SBP’s National Financial Inclusion Strategy 2024–28 emphasizes digital financial services and responsible finance, while the central bank’s internal audit guidance encourages the use of advanced technological tools. Experts have stressed that banks adopting AI need to maintain control over data residency, role-based access and audit logging while ensuring compliance with applicable legal and regulatory requirements. A private AI approach could allow financial institutions to retain greater control over sensitive banking information while using AI for analysis and operational support. As Pakistan’s digital payments ecosystem continues to expand, the combination of stronger data governance, controlled AI deployment and human oversight is expected to remain an important consideration for banks seeking to manage risk while expanding digital financial services.
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