New Delhi: Senior Advisor, NITI Aayog, Anna Roy has said that with increasing use of artificial intelligence (AI) in the financial sector, we as policymakers and regulators need to take extra care that regulation or regulatory framework should not inhibit innovation. “This is the second wave of financial inclusion post the India Stack wave. Now account aggregators will help us in reaching out to the underserved segments that remain out of the formal financial fold,” she said.

Addressing the virtual conference on ‘AI in Indian Financial Services – Uncovering Ground Truth’ organized by FICCI on February 28, Roy said that this is one of the key areas where privacy needs to be kept high. “We are closely working on promoting an account aggregator platform, which we feel is the future because while privacy issues are important, we also need to ensure proper consent by the data owner. These account aggregators will help us in reaching out to those underserved segments which are still out of the formal financial system,” added Roy.

She further highlighted that with digital divide, digital literacy along with cyber security related issues the use of AI in financial services has a lot of avenues. “In sectors represented by public goods, the approach of the government has been to take a lead and be the key driver, whereas in sectors like the financial sector, the government’s role is more of an enabler and a catalyst,” stated Roy.

Highlighting the importance of AI in the overall financial sector, Roy added that the government is also working to expand the use of AI in the pension and insurance sector as well to benefit the customers and extend the coverage of social security schemes. Stressing on the transparency in the policy and regulations, Roy emphasized that the government adopts consultative approach while drafting any policy. “I think that kind of transparency in policymaking is extremely important, and all stakeholders need to work together towards a common goal,” she said.

Prof D Janakiram, Director, IDRBT, said that artificial intelligence, banking and financial systems and cloud are the three technologies that are coming together to create a synergy for the next generation products. “People are looking at complete lifecycle management and support for all the aspects of their financial journey with the banking system,” he added. He further said, “What has made AI mainstream today is the ability to build models with large data in less time.”

Rashesh Shah, Past President, FICCI, Chair- FICCI Financial Sector Council and Chairman, Edelweiss Group, said, “The three important use cases in financial services where technology is required are customer experience, innovation and in reducing intermediation cost.” He further added that we are on our path in reaching a $10 trillion economy in the next 10 years and financial services will play an important role. “Data is the new oil, and AI is the refining power,” he added. /BI/