This study examines how, as global economies transition to sustainable development, green finance emerges as a catalyst for leveraging capital towards projects that contribute to sustaining the environmental movement. The role of artificial intelligence (AI) is transforming the financial sector by providing data-driven solutions that aid in decision-making and making a substantial contribution to risk management. The systematic literature review investigates the role of artificial intelligence in green finance with a focus on its opportunities and challenges in congruence with environmental, social, and governance (ESG) risks. It also explores how these global trends integrate with developments in Oman’s Vision 2040. This study recommends adopting a systematic literature review approach by examining peer-reviewed journals, case studies, and industry reports from the year 2018 onwards. The findings of the study depict multiple applications of AI in the green finance field, encompassing ESG data analytics, forecasting carbon emissions, sustainability reporting automation, and green investment advisory supported by AI. Although the integration of artificial intelligence into green finance is desirable, it introduces challenges reflecting data quality matters, low standardization in ESG metrics, issues of model elaboration, regulatory concerns, and the environmental influence of AI. In Oman, though some banks have taken an initiative to consider AI support in assessing risk and digital banking foundations, there remain some gaps in AI policy dissemination, issues of infrastructure, and ESG legislative aspects that curtail AI adoption at a wider level.