Now Reading: RBI weighs wider AI rules for banks and NBFCs
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RBI weighs wider AI rules for banks and NBFCs
The Reserve Bank of India is discussing comprehensive guidelines for banks and non-bank lenders using artificial intelligence, Livemint reports, citing a person familiar with the discussions. The proposed framework could bring together…
The Story in Brief
The Reserve Bank of India is discussing comprehensive guidelines for banks and non-bank lenders using artificial intelligence, Livemint reports, citing a person familiar with the discussions. The proposed framework could bring together requirements now spread across issue-specific rules, with several RBI departments working with its department of regulation.
The discussions follow the RBI’s June draft on model risk management, which called for human oversight and kill-switch arrangements for AI models. Possible rules may cover customer data used for training, data storage, safeguards, and AI used in lending or regulatory reporting. Lenders are expanding adoption. Bajaj Finance uses AI cameras at more than 500 stores and plans to reach 3,000 by March 2027, while Tata Capital reported a 14-basis-point year-on-year reduction in credit cost through AI-based monitoring.
The Indian Opinion
AI can make lending faster, but claims of effortless efficiency are as weak as warnings that every automated decision is dangerous. The real test is whether customers can challenge a mistaken rejection, whether sensitive data stays protected, and whether a human can stop a faulty system. RBI’s proposed rules should be judged by these safeguards, not by the number of pilots announced or the promise of lower costs.
Source: livemint.com
This story was synthesised by AI from the source linked above.
