Advances in artificial intelligence (AI) are expanding financial inclusion for individuals and micro, small- and medium-sized enterprises (MSMEs) that have been underserved by traditional banking institutions, according to the World Bank.
The lender, in its latest World Development Report, titled The Promise of Artificial Intelligence, said AI can create opportunities for MSMEs to access financial services through credit-scoring models.
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Nigeria was among the countries covered by the World Bank Enterprise Survey on AI Adoption, with 777 Nigerian firms included.
According to the Bank, AI-driven scoring models leverage alternative data, such as mobile money transactions, digital payment data, e-commerce activity, and records of utility and telecommunications use, to assess the creditworthiness of borrowers without formal credit histories.
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“These models are also more dynamic than rule-based ones because they can learn from borrowers’ behaviour,” the lender said in its development report.
Citing Brazil, Kenya and India, where AI has been adopted largely in financial services, the World Bank said lenders were able to provide credit to more people by using machine-learning algorithms to develop alternative credit scores based on individuals’ digital footprints.
Know-your-customer
Using AI to onboard new customers also supports financial inclusion for previously excluded segments by reducing the time required to complete know-your-customer (KYC) requirements from weeks to minutes, the report revealed.
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The World Bank added that the method lowers compliance costs by 50–70 per cent while reducing the rate at which customers leave.
The lender, however, warned that AI-driven opportunities may not translate into meaningful financial inclusion unless the data underpinning these solutions adequately capture the financial activities of women, informal workers, smallholder farmers and MSMEs.
The lender also warned that AI could amplify existing biases in credit scoring or exploit the vulnerabilities of prospective and existing customers as financial institutions increasingly use AI to promote and extend credit.
“Without proper safeguards, the use of AI in these contexts also risks entrenching exclusion rather than correcting it,” the Bank said.
The World Bank’s position aligns with the Central Bank of Nigeria’s (CBN) financial inclusion agenda, as the apex bank launched the Nigeria Payment System Vision (PSV) 2028 in June.
The PSV aims to expand financial inclusion to 95 per cent of Nigeria’s adult population and bring an estimated 50 million additional Nigerians into the formal financial system by 2028.
Although CBN Governor Olayemi Cardoso did not specifically address AI adoption, he said the framework builds on Nigeria’s progress in digital payments and is designed to accelerate the transition towards a more inclusive, technology-driven financial ecosystem.
Business, AI
The rapid adoption of artificial intelligence (AI) is being driven largely by businesses that have already integrated digital tools into their operations, according to a World Bank report.
The lender said more than three-quarters of firms across the countries covered by its study already use business messaging apps, social media applications and standard software packages, creating a foundation for faster AI adoption.
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It said the widespread use of digital tools suggests that businesses could quickly adopt suitable generative AI (GenAI) solutions to improve productivity, including firms that would traditionally be considered unlikely adopters.
The report highlighted Nigeria as an example, noting that AI adoption is extending even to businesses that rely on traditional record-keeping methods.
“In Nigeria, for example, 21 per cent of firms that primarily use handwritten records to administer their businesses are adopting AI in some form, mostly by using AI chatbots that are easily accessible through mobile phones,” the report stated.
The World Bank said AI is also giving entrepreneurs and young businesses access to relatively low-cost tools for tasks that previously required specialised teams or significant upfront investment.
According to the lender, businesses can use AI to design websites, run targeted marketing campaigns and produce professional content, potentially lowering barriers to entry and enabling productive firms to expand.
The international organisation further said the uneven adoption of AI could widen productivity differences between and within countries.
It warned that without complementary investments in infrastructure, skills, institutions and venture capital, AI could do little to increase the number of successful entrepreneurs and fast-growing businesses.
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