The Reserve Bank of India (RBI) has announced its plans to set up a committee to develop a framework for the ethical enablement of artificial intelligence (AI) for the finance sector. The committee, comprising experts from diverse fields, will be tasked to recommend a robust, comprehensive, and adaptable AI framework for the financial sector.
“The financial sector landscape is witnessing rapid transformation, enabled by technologies such as AI, tokenization, cloud computing, etc.,” RBI Governor Shaktikanta Das said in his Monetary Policy statement. Monetary Policy refers to actions taken by a country’s central bank to manage the money supply and influence economic activity.
“In order to harness the benefits from these technologies, while addressing the associated risks such as algorithmic bias, explainability, data privacy, etc., a committee comprising of experts from diverse fields will be set up to recommend a Framework for Responsible and Ethical Enablement of AI (FREE-AI) in the financial sector,” Das explained.
The central bank’s initiative comes at a time when generative AI (GenAI) is expected to contribute $359-438 billion to India’s gross domestic product (GDP) by 2029-2030, making ethical and responsible use of the technology imperative for the country’s economic growth and financial sector.
“Technologies like AI/ Machine Learning (ML), tokenisation, cloud computing, hold transformative potential for the financial sector as they can handle enormous volumes of data, automate complex processes, enhance decision-making, and bring in unprecedented efficiencies,” the central bank said in its statement on Developmental and Regulatory Policies.
“To harness the benefits, it is critical to address the attendant risks early in the adoption cycle,” RBI added.
India AI Mission, too, harps on responsible AI use
RBI’s setting up of a committee of experts to prepare a responsible AI framework is also in sync with the India AI Mission, an initiative to boost India’s global leadership in AI and ensure ethical and responsible AI deployment.
In March, India approved Rs 10,300 crore ($1.24 billion) for the next five years to boost the country’s AI ecosystem, innovation, and entrepreneurship. The India AI Mission—with a key focus on developing high-end computing infrastructure in the country—is also expected to facilitate access to funds for AI startups.
A December statement from the Ministry of Electronics and Information Technology (MEITY) provides a detailed breakdown of the funds allocated for the India AI Mission and emphasizes the responsible and ethical use of AI.
“The ‘Safe & Trusted’ pillar within the IndiaAI Mission aims to encourage the adoption of AI in a responsible manner with the principles of safety, security, transparency, and privacy embedded in the design of AI technology to mitigate the AI risks, placing the idea of ‘AI for All’ at its very core,” MEITY’s statement said.
“Under this Pillar, eight responsible AI projects have been selected to address the need for robust guardrails to ensure the responsible development, deployment, and adoption of AI technologies,” the statement added.
The projects cover a range of critical themes, including AI Bias Mitigation, Ethical AI Frameworks, Privacy-Enhancing Tools, Explainable AI, and AI Governance Testing, among others.
The India AI Mission envisions provisioning a high-end, scalable AI computing ecosystem comprising AI compute infrastructure of 10,000 or more Graphics Processing Units (GPUs) over a five-year period.
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