The bank started operation after the agreement entered into force on 25 December 2015, after ratifications were received from 10 member states holding a total number of 50% of the initial subscriptions of the Authorized Capital Stock.

[6] The United Nations has addressed the launch of AIIB as having potential for "scaling up financing for sustainable development"[7] and to improve the global economic governance.

[12][13] The proposal for the creation of an "Asian Infrastructure Investment Bank" was first made by the Vice Chairman of the China Center for International Economic Exchanges, a Chinese government think tank, at the Bo'ao Forum in April 2009.

[14] The initiative was officially launched by General Secretary of the Chinese Communist Party Xi Jinping on a state visit to Indonesia in October 2013.

[25]: 221  On 24 October 2014, twenty-one countries signed a Memorandum of Understanding (MOU) regarding the AIIB in Beijing, China: Bangladesh, Brunei, Cambodia, India, Kazakhstan, Kuwait, Laos, Malaysia, Myanmar, Mongolia, Nepal, Oman, Pakistan, Philippines, Qatar, Singapore, Sri Lanka, Thailand, Uzbekistan and Vietnam.

[29][30][31][32] Hong Kong's Financial Secretary John Tsang announced in his budget speech in February 2015 that the territory would join the AIIB.

In early March 2015, the United Kingdom's Chancellor of the Exchequer, George Osborne, announced that the UK had decided to apply to join the Bank, becoming the third Western country to do so after Luxembourg and New Zealand.

A US government official told Financial Times, "We are wary about a trend toward constant accommodation of China, which is not the best way to engage a rising power."

"[35] In response, the UK indicated that the subject had been discussed between Chancellor Osborne and US Treasury Secretary Jack Lew for several months preceding the decision.

By encouraging Chinese investments in the next generations of nuclear power plants, Osborne announced that "the City of London would become the base for the first clearing house for the yuan outside Asia.

Following the criticism, the White House National Security Council, in a statement to The Guardian, declared, Our position on the AIIB remains clear and consistent.

17 states (Australia, Austria, Brunei, China, Georgia, Germany, Jordan, Luxembourg, Mongolia, Myanmar, the Netherlands, New Zealand, Norway, Pakistan, Singapore, South Korea and the United Kingdom) together holding 50.1% of the initial subscriptions of Authorized Capital Stock, had deposited the instrument of ratification for the agreement, triggering entry into force, and making them all founding members[42] and bringing the Articles of Agreement, the bank's charter, into force.

It stems from the notion that long-term economic growth can only be achieved through systematic, and broad-based investments in infrastructure assets – in contrast with the more short-term "export-driven" and "domestic consumption" development models favored by mainstream Western Neoclassical economists and pursued by many developing countries in the 1990s and the first decade of the 21st century with generally disappointing results.

In March 2017, 13 other states were granted prospective membership: 5 regional (Afghanistan, Armenia, Fiji, Timor Leste and Hong Kong, China) and 8 non-regional: Belgium, Canada, Ethiopia, Hungary, Ireland, Peru, Sudan and Venezuela.

In May 2017, 7 states were granted prospective membership: 3 regional (Bahrain, Cyprus, Samoa) and 4 non-regional (Bolivia, Chile, Greece, Romania).

[50] In 2018, 7 other states were granted prospective membership: 1 regional (Lebanon) and 6 non-regional (Algeria, Ghana, Libya, Morocco, Serbia, Togo).

[51][52] In 2019, 9 other states were granted prospective membership: 9 non-regional (Djibouti, Rwanda, Benin, Côte d'Ivoire, Guinea, Tunisia, Uruguay, Croatia, Senegal).

An overview of the constituencies is shown below:[81] The former President of the World Bank, Jim Yong Kim, has said that the need for infrastructure in developing countries is great so that the activities of new organizations would be welcome.

[86] On the other hand, Paola Subacchi (Chatham House) argues that the AIIB represents a threat to US-dominated global governance.

[87] Think-tanks such as Chatham House, the China Studies Centre at the University of Sydney and the World Pensions Council (WPC) have argued that the successful establishment of a new supranational financial powerhouse headquartered in PRC would be facilitated by the large number of participating developed economies.

[88][89] These experts observe that the establishment of the Beijing-based AIIB does not necessitate rivalry, when economic cooperation is possible,[88] and that the decision by the UK to participate advances its own interests even if some of its allies are opposed.

[89] Although the proposed bank declared "AIIB will learn from the best practice in the world and adopt international standards of environmental protection," Oxford scholar of economics and energy policy Yuge Ma has argued that this may be complicated in developing Asian countries.

[90] In June 2023, Bob Pickard, a Canadian national and the global communications director and official spokesperson of AIIB resigned,[91] and fled from China.

[92] Pickard said that the AIIB was dominated by Chinese Communist Party (CCP) members who operate as an in-house secret police.

Conservative MP Tim Loughton, who was impacted by a Chinese cyber campaign, called for an audit of the UK's relationship with the AIIB.