The Bangladesh Bank is developing a comprehensive Artificial Intelligence (AI) policy for the country’s banking sector to ensure the safe, transparent, and efficient use of AI technologies. The initiative aims to enhance fraud prevention, risk management, economic forecasting, internal efficiency, and customer service across banks.

According to sources, a seven-member special team from the central bank’s Information Technology Department is currently working on the policy. The team has already begun drafting and is expected to prepare a policy framework within the next two months, aligning it with international standards. The initiative is being coordinated by Executive Director Muhammad Zakir Hasan of Bangladesh Bank.

Officials said the central bank’s ultimate goal is to modernize and digitize the country’s banking system, making it more resilient and secure. As part of this plan, Bangladesh Bank intends to develop its own Large Language Model (LLM) for AI implementation. This will help ensure data sovereignty, as sensitive financial data will no longer need to be sent abroad for processing.

Through the use of AI, large volumes of economic data can be analyzed to generate more accurate projections for inflation, GDP growth, and foreign exchange reserves. AI will also play a crucial role in managing credit, market, and liquidity risks, while helping accelerate innovation in fintech and digital banking services.

A recent study by the Bangladesh Institute of Bank Management (BIBM) found that around 60% of banks in Bangladesh currently lack policies on the use of AI in cybersecurity, while only 40% have formulated such guidelines.

Experts believe that once implemented, the Bangladesh Bank’s AI policy will serve as a regulatory roadmap for the country’s financial institutions, promoting responsible AI adoption and technological advancement in the banking industry.