By 
By John Syekei, Partner and Head of Intellectual Property and Technology, Bowmans Kenya
AI adoption among banks in Kenya is surging. Kenya’s crowded banking sector is not only competing internally but also against telecommunications and insurance companies, all looking to exploit AI for competitive advantage.
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Regulation
The Central Bank of Kenya’s stance on cryptocurrency means it is likely the regulator will be closely involved in how Kenyan banks adopt AI for service delivery. But at the end of the day, because of competitive pressure, it will be rolled out, and we expect the authorities to adopt light-touch regulation along the lines of Japan’s regulatory framework, rather than be heavy-handed.
Legal framework
Back in March 2025, Kenya officially launched its National Artificial Intelligence (AI) Strategy (2025-2030) (Strategy), marking a significant step toward positioning the country as a leader in AI adoption and governance in Africa. The goal of the Strategy is to create a roadmap for responsible AI development while ensuring alignment with Kenya’s broader digital economy agenda. The Strategy complements the Central Bank’s evolving approach to AI implementation and provides a clearer framework for financial services companies looking at ways to adopt AI.
The Strategy proposes several technical and regulatory reforms to create an enabling environment for AI adoption, including cloud computing and AI infrastructure, addressing skills and capacity gaps, strengthening data protection and governance, and AI decision-making, fairness and data quality. These reforms create a more enabling environment for banks to deploy a range of AI tools.
AI tools
Financial services CEOs in Africa are taking an interest in ‘agentic frameworks,’ where AI systems can perform tasks autonomously with minimal human interaction. Agentic frameworks, which have been hailed as a game-changer for AI in financial services, are the newest and most powerful of the three types of AI (the others being ‘conversational’ AI and retrieval-augmented generation, or RAG).
A 2025 Central Bank of Kenya study shows that 46% of Kenyan banks have already set up internal teams to start developing their own AI tools, including RAG and agentic AI. The other 40% have commissioned developers to work with them to develop their own AI tools, probably largely more towards chatbots for consumer experience improvement. The remaining 10% are partnering with small startups to build specific AI tools.
A likely result of AI rollout across East Africa is large-scale reorganisation in the banking sector, translating to fewer but much larger banks operating across the continent. Banks that are able to use AI effectively to improve efficiencies, save costs and attract customers will be in the strongest position. For those who are able to successfully adopt AI in Africa, there will also be potential for some good merger and acquisition opportunities down the line.
