AI in Egyptian banking is “in its infancy,” and the pause is deliberate

Egypt’s financial sector is still holding back on AI while the rules get written, executives said at the EnterpriseAM Egypt Forum on Monday. Banking AI in Egypt is “a little bit in our infancy because the regulatory and legal framework is still being defined,” HSBC Egypt CEO Todd Wilcox told the audience. “Everybody is under a bit of a pause,” so the bank is testing only on small projects for now.

The brakes

The regulatory brake: Current regulations mean client data “cannot be on the cloud” — it has to stay in-house or on a local cloud due to data sensitivity, CEO of local and regional markets at Beltone Holding’s Khalil El Bawab said on stage. Microsoft’s Middle East and Africa Growth Markets General Manager Mirna Arif said companies ready to transform “want to, but then regulation would prevent them from doing so.” The fix needs policy, industry training, and workforce readiness to advance together, with regulation as the “key enabler,” she added. El Bawab sees an “opportunity” to build compliant infrastructure from the start, and described the regulator as “very open to those developments.”

The structural brake: Even if the regulatory questions were resolved tomorrow, a second barrier would remain. Most banks run on legacy systems, including inconsistent data and outdated platforms. Capgemini Egypt CEO Hossam Seifeldin said “you cannot run an AI system on such a platform. You need to have the right foundation.” That foundation takes time and capital to build, and few institutions have made the investment yet, he added.

The accountability brake: When an AI tool is involved in a financial decision, the question of who takes the hit is not theoretical. “Who is going to be sued? It’s the managing director or the CEO of the company, not the machine,” El Bawab said. Wilcox agreed, adding that AI does not fix broken governance: “If you have got poor governance and no accountability, it simply leads to making bad decisions faster.”

BUT- The shift is already happening whether banks have formalized it or not, Algebra Ventures Managing Partner Omar Khashaba countered, saying AI is “making decisions” within organizations today. The firms that capture the judgment (the institutional memory of why decisions get made) will build a lasting advantage as AI models become commodities. But none of that changes who is ultimately responsible. “Accountability resides 100% with humans,” he said.

The cost of inaction

The risk of moving too slowly is just as real. Wilcox drew a parallel to a previous technology shift: bankers used to calculate mortgages with paper factor tables, and when financial calculators arrived, “half the bankers didn’t make it; they couldn’t transition.” His warning: if you are not able to keep up and learn, you will be caught.

IN CONTEXT- Two things are happening while banks wait. The first is a global warning, as Moody’s flagged in August that banks racing into AI risk “systemic dependency” on a handful of loss-making Silicon Valley vendors — a concentration risk that echoes the governance caution the forum speakers raised. The second is that the Egyptian regulator is not idle on the broader digitization front. The Central Bank of Egypt approved electronic Know-Your-Customer (eKYC) the same month, letting banks verify customers entirely online, and has introduced digital banking licenses and regulatory sandboxes. The broader digital framework is being built — the AI rules are the piece still in development.