Artificial Intelligence for Financial Sector Supervision: An Emerging Market and Developing Economies Perspective

Overview & Synopsis

The primary focus of this report is to contribute to a better understanding of the state of AI adoption in supervision by EMDE financial sector authorities and the associated practical issues, challenges, and risks they face. This report focuses on EMDEs to complement existing work on global AI adoption and governance by central banks (e.g., Consultative Group on Risk Management 2025), AI for risk-based supervision in the financial sector (e.g., Dohotaru et al. 2025), SupTech adoption by financial sector authorities (e.g., Cambridge Suptech Lab 2024), regulating AI in the financial sector (e.g., Crisanto et al. 2024), and the financial stability implications of AI (e.g., FSB 2024). The focus on African authorities also builds on other World Bank work on digital infrastructure in Africa (e.g., World Bank 2024). The audience for the report includes EMDE financial sector authorities and their government partners, as well as the range of other domestic and international stakeholders that participate in supporting improvements in financial sector supervision in EMDEs, including through leveraging SupTech. The report is not intended to be a ‘how to’ guide on AI implementation in EMDE authorities but rather aims to assist EMDE authorities and other stakeholders in having a better awareness of common challenges and how they are being addressed in an EMDE context. Based on these findings, the report also offers preliminary, forward looking considerations for EMDE authorities in addressing such challenges. As a secondary focus, the report examines how financial sector authorities are beginning to identify and monitor AI-related risks specific to financial consumer protection (FCP) and market conduct (MC).