Artificial intelligence (AI) technology have been a major factor in the dramatic development of the banking industry in recent years. This study examines how artificial intelligence (AI) is affecting the banking sector, with a particular emphasis on the technology's uses, advantages, difficulties, and potential. The first section of the study looks at the several AI-driven banking applications, such as risk management, fraud detection, fraud scoring, customer support, and tailored banking experiences. It explores how artificial intelligence (AI) algorithms can handle enormous volumes of data to boost customer satisfaction and operational effectiveness. This study also discusses the difficulties and worries related to the use of AI in banking, including data security, legal compliance, and ethical issues. It talks on the necessity of strong cybersecurity defences to safeguard private financial information and the significance of following rules in the AI-driven banking industry.

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Keywords: Artificial Intelligence, Banking Sector, Operational, Effectiveness.