Artificial Intelligence and Blockchain Technology in Islamic Banking: Importance, Advantages, and Challenges

Abstract

In recent years, Islamic financial and banking institutions have begun using artificial intelligence (AI) technologies to enhance their efficiency, automate operations, improve service quality, and increase their competitive advantages. This paper aims to highlight the importance of AI—both centralized and decentralized—and its role in improving the performance of Islamic banks and the quality of their services. The paper presents the key features of centralized and decentralized AI and the opportunities they provide for Islamic banks to enhance their operations and services in an intensely competitive market environment. The study recommends that Islamic banks intensify their efforts in the field of AI applications by developing the necessary infrastructure, training staff, and implementing measures to ensure data safety, security, privacy protection, and transaction transparency. It also recommends that supervisory and regulatory bodies in central banks and relevant authorities work toward establishing governance frameworks and standards for the use of AI in Islamic banks.