Kazakhstan to Develop AI Rules for Financial Sector

Kazakhstan’s Agency for Regulation and Development of the Financial Market (ARDFM) plans to establish a regulatory framework governing the use of artificial intelligence (AI) in the country’s financial sector. The announcement was made by ARDFM Chair Madina Abylkassymova during the 13th Congress of Financiers of Kazakhstan. According to the regulator, 75% of banks in Kazakhstan already use AI technologies in areas such as credit scoring, fraud detection, marketing, and customer service chatbots. However, adoption levels vary significantly: large banks have made substantial progress, while medium and smaller institutions are primarily conducting pilot projects. Abylkassymova stressed that the widespread use of AI is imminent, necessitating the development of unified standards and regulatory guidelines. “There is currently no dedicated document regulating artificial intelligence, but one will certainly be introduced,” she said. “The main challenges today involve the absence of uniform standards, inconsistent data quality, and a shortage of qualified specialists. At present, each financial institution independently sets objectives and configures its AI systems, but without common rules. We must therefore rely on existing regulatory practices and client-service standards.” She added that regulatory measures should be proportionate to the level of risk associated with specific financial transactions. “We will conduct a detailed risk assessment. We do not believe every application of AI must be tightly regulated. Low-risk areas may require light oversight, whereas high-risk applications, particularly those with systemic implications, should face stricter controls.” Abylkassymova identified data quality as a major obstacle to AI development. She noted that information is often fragmented and stored across various systems and formats, increasing the likelihood of errors in AI-driven decision-making. A proposed legislative initiative includes the creation of a unified database of anonymized data accessible to market participants, aimed at improving AI model accuracy. Ongoing discussions are addressing whether access to government databases should be free or paid, and whether different pricing models should apply depending on the purpose of use. “We place extensive requirements on financial institutions, including offering access to government services through their digital platforms,” Abylkassymova explained. “To fulfill these functions, banks need access to public databases. So, the question is: is it justified to charge for such access? That’s one scenario. It’s another matter entirely when access is sought for purely commercial gain.” She concluded that the future AI framework will be developed in consultation with market stakeholders, with the goal of striking a balance between enabling innovation and safeguarding financial system stability. Previously, The Times of Central Asia reported that Kazakhstan’s Ministry of Finance is piloting a digital platform that leverages AI and big data to help entrepreneurs identify the most profitable sales locations for their products.

Kazakhstan Proposes Mandatory Home Insurance Against Natural Disasters

Kazakhstan’s Agency for Regulation and Development of the Financial Market (ARDF) has introduced a draft law that would mandate insurance for residential properties against natural disasters. The proposed legislation, now available for public review on the "Open NPAs" portal, aims to establish a nationwide system of financial protection in the event of earthquakes, floods, and wildfires. A Response to Widespread Risk According to UNICEF, roughly 75% of Kazakhstan’s territory is vulnerable to natural hazards, yet only 3.2% of the country’s housing stock is currently insured. In Almaty, Kazakhstan’s largest city and a high-risk seismic zone, coverage reaches just 7.7%. The ARDF argues that compulsory insurance would help reduce fiscal pressure on the state by ensuring that regions most exposed to natural disasters have a legal safety net. The proposed policy would be regionally tiered based on risk level and priced between 1,000 and 20,000 KZT ($2 to $40) annually, roughly equivalent to the current property tax. Initially, payouts would cover urgent needs, up to 10 million KZT ($20,000), with future provisions extending to repair costs or the purchase of new housing. Subsidies are planned for socially vulnerable populations. The draft also envisions the creation of a dedicated state insurance organization to collect premiums and disburse compensation. The agency believes this model will accelerate post-disaster housing reconstruction and reduce budgetary strain. The proposal is open for public discussion until May 12. If adopted, the law is expected to come into effect in 2026. Drawing Lessons from Turkey The initiative draws heavily on Turkey’s experience, where a similar system has been in place since 2000. As National Bank analyst Janibek Asylbekov explained, both countries face comparable natural and geographic risks. In Turkey, compulsory insurance covers private homes and apartment buildings, with the state playing a central role through an insurance fund that partners with private firms. Asylbekov stressed the importance of leveraging digital technologies to streamline registration and payment processes, suggesting integration with routine systems such as utility billing. He also highlighted the need for public outreach, citing Turkey’s collaboration with its Ministry of Education to promote awareness among schoolchildren. To ensure accessibility, he recommends setting modest initial premiums that vary by region, taking into account local income levels and risk exposure. In Turkey, insurance rates differ based on factors such as property type, age, size, and the number of floors. Discounts are available for policy renewals and for older housing stock.