Solving the AI Puzzle in Finance

The United Arab Emirates stands at a pivotal moment, positioned to redefine financial services through artificial intelligence adoption. Backed by strong national strategies, supportive regulations, and increasing investment, the nation aims to turn its finance sector into a showcase for AI’s tangible benefits. While the potential is immense, the central challenge lies in accelerating the pace at which organizations can unlock AI’s complete value.

Targeted AI applications are already making significant inroads into finance operations. A prominent regional bank, for example, has integrated generative AI to streamline internal reporting, assist with regulatory filings, and enhance financial risk analysis. In another case, an oil and gas distributor introduced an AI-driven chatbot for investor relations that delivers real-time key performance indicators. A telecommunications provider automated its invoice processing and collections while using AI to train finance personnel in budgeting and cash flow monitoring.

Research indicates that close to half of UAE organizations have active AI strategies for their finance departments. About eight percent are already using AI, while fifty-nine percent are either planning or conducting pilot projects. Another third are in the initial pilot phase. Accounting and management control units show the most enthusiasm, drawn by the clear efficiency improvements and predictive capabilities that automation offers.

Beyond boosting efficiency, finance leaders in the UAE view AI as a means to enhance trust and operational resilience. Key advantages identified include real-time risk and fraud detection, superior data accuracy, and more insightful decision-making. These benefits are especially valuable in the UAE’s dynamic market, where maintaining agility and transparency is essential for staying competitive and retaining stakeholder confidence.

However, turning AI investment into measurable financial returns remains a hurdle. Currently, just 37% of UAE finance functions report a positive return on their AI investments, a figure notably lower than the global average of 66%. On average, organizations in the UAE allocate 6% of their IT budgets to AI, compared to 13% among global finance leaders who are advanced in AI adoption, signaling a clear need for greater financial commitment.

Regulatory barriers are not the primary obstacle in the UAE, unlike in some other regions. The real challenges are internal: pilot projects are often isolated, data quality varies, and skill levels are inconsistent. Small and mid-sized businesses are just starting their AI journeys, with many still developing the foundational capabilities required to implement AI across daily financial activities.

Failing to close this gap could slow progress. Conversely, organizations that move decisively have a prime opportunity to gain a competitive edge. The National Strategy for AI 2031 offers a solid framework, and the broader ecosystem is conducive for finance teams to thrive.

Government policy further supports this direction. AI has been incorporated into the federal budget cycle for 2027–2029 to improve efficiency and decision-making. Collaborative efforts, such as those between the Emirates Institute of Finance, banks, and AI companies, illustrate how public and private sectors are joining forces to create an enabling environment for AI in finance.

These initiatives reflect a national determination to embed AI as a cornerstone of economic advancement. For finance teams to succeed, they must concentrate on core principles: defining clear return-on-investment targets, selecting practical initial applications, and establishing the governance and skills needed for confident scaling. Centralizing data and embedding accountability into workflows will be vital to prevent fragmentation and ensure that AI adoption yields concrete benefits.

Generative AI represents a major shift in the technological landscape. Worldwide, 41% of finance leaders already use generative AI in reporting, a number projected to reach 88% within three years. Over half of these leaders plan to prioritize generative AI over traditional AI in the next year, signaling the technology’s transition from experimental to essential. For the UAE, where national policy and investment already favor digital transformation, this trend offers a chance to leapfrog ahead.

The path forward requires establishing clear AI guidelines and governance, developing digital processes that comply with evolving regulations, and adopting modern IT infrastructure capable of supporting AI at scale. Beginning with manageable pilot projects, carefully selecting use cases, and validating returns will build a compelling business case for wider implementation.

By advancing decisively from limited pilots to organization-wide deployment, UAE finance teams can fully harness AI’s potential. This means predicting cash flows in real time, detecting fraud instantly, automating financial reporting, and empowering finance leaders to act as strategic partners to the business.

A focused, strategic approach will not only strengthen the UAE’s financial resilience but also set a global benchmark for responsible innovation, illustrating how artificial intelligence can drive competitiveness, foster resilience, and support sustained economic growth.

(Source: Economy Middle East)