Colin Ighedose ASUELIME

Christiana Favour Omohofe, ODIDI| Isaac Adeniyi ADEBANJO

Abstract

This study examines the relationship between artificial intelligence (AI)-enabled financial services and customer trust within the Nigerian banking sector. Nigerian deposit money banks have increasingly deployed AI-driven tools — including conversational chatbots, biometric authentication, algorithmic credit scoring, robo-advisory platforms, and machine learning-based fraud detection — to improve operational efficiency, reduce costs, and enhance customer experience. Yet the extent to which these technologies foster or erode customer trust remains contested, particularly in an environment characterised by uneven digital infrastructure, cybersecurity concerns, and evolving regulatory oversight. Drawing on a review of recent empirical literature, regulatory developments from the Central Bank of Nigeria (CBN), and established technology-adoption and trust theories, this paper develops an integrated framework linking AI service attributes — accuracy, transparency, data security, and perceived humanness — to dimensions of customer trust, namely competence-based, integrity-based, and benevolence-based trust. The analysis suggests that trust, rather than technological sophistication alone, is the decisive factor shaping customer acceptance of AI-enabled banking. Customers who trust their banks are more receptive to AI applications even when they do not fully understand the underlying algorithms, while low-trust customers remain sceptical regardless of technical performance. The paper further finds that transparency, data privacy assurance, human fallback options, and effective grievance redress substantially moderate the trust-adoption relationship. The study concludes with implications for bank management, regulators, and future research, arguing that sustainable AI adoption in Nigerian banking requires deliberate investment in explainability, consumer protection, and digital literacy alongside technological upgrading.

   

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Published: 2026

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