<p>The financial services system shows a significant part in offering sustainable financial services (SFSs) to prod sustainability perspectives under different enterprises and firms worldwide. Though, impacts for digital transformations on financial service suppliers are dawdling, and little study has been recognized in this sector. Until now, very few decision-making frameworks have been piloted in this sector as well. Thus, this paper first commences a systematic review of existing sustainable financial service (SFS) systems to begin a trend of existing SFS actions to improve future research prospects. Owing to association of various sustainability facets, the assessment of the digital transformation challenges in SFS systems can be treated as a multi-criteria group decision-making (MCDM) problem. The objective of paper is to develop hybrid interval-valued Pythagorean fuzzy (IVPF)-based decision-making model for assessing digital transformation challenges in SFS systems and choosing a suitable sustainability-related SFS system under uncertainty setting. In the following, an integrated weight determining method is developed using the proposed IVPF-entropy and rank sum method. Further, the multi-attribute multi-objective optimization by ratio analysis is developed for ranking and selecting sustainability-related SFS systems. A case study to evaluate the digital transformation challenges of SFS systems in banking sector is discussed. Comparison and sensitivity discussions are given to show the advantages of the proposed approach.</p>