Reserve Bank of India Governor Sanjay Malhotra met with chief executives of major Indian banks on Tuesday to discuss the growing implications of artificial intelligence, geopolitical complexities, and new expected credit loss (ECL) guidelines.
The gathering underscores the central bank’s proactive stance on managing non-traditional risks that could impact the stability of the financial system.
The discussion on artificial intelligence reflects a broader global trend among central banks to scrutinize how generative AI and automated decision-making tools are integrated into banking operations.
Regulators are increasingly concerned about model risk, data privacy, and the potential for AI-driven errors to propagate through financial networks.
By bringing this topic to the forefront, the RBI is signaling that banks must have robust governance frameworks in place for their AI deployments.
Geopolitical tensions also featured prominently in the dialogue.