Responsible AI key to future of finance, says NPCI at Global FinTech Fest 2025

Artificial intelligence (AI) is rapidly moving from pilot projects to mainstream adoption in financial services, with the potential to boost efficiency, inclusion, and resilience, the National Payments Corporation of India (NPCI) said at the Global FinTech Fest (GFF) 2025 in Mumbai.

NPCI Non-Executive Chairman Ajay Kumar Choudhary said AI investments across banking, insurance, capital markets, and payments are projected to reach $100 billion by 2027, with 78% of financial organisations already deploying AI in at least one function — up from 55% in 2023.

AI’s transformative edge lies in Generative AI and Agentic AI, which can automate compliance, improve fraud detection, and enhance trading and customer engagement. Global banks could see $200–340 billion in productivity gains annually, Choudhary noted.

However, he cautioned against risks such as model bias, explainability gaps, and concentration in AI infrastructure — with only a few companies dominating chips, cloud, and foundation models. “Responsible AI is not a slogan. It is the only way forward,” he said, urging for cross-border collaboration and strong governance frameworks to ensure stability and fairness.

Choudhary also underscored India’s global leadership in inclusive digital payments, citing UPI’s 20 billion monthly transactions and AI-driven tools like federated fraud detection and mule account monitoring. Initiatives such as UPI Lite, UPI for Her, and UPI 123Pay continue to extend financial access to low-bandwidth regions and women entrepreneurs.

Looking ahead, NPCI plans to expand UPI and RuPay globally, develop affordable cross-border remittance corridors, and build deep-tech capacity through NPCI Tech Solutions Ltd. (NTSL) and Bharat Connect’s Internet & Mobile Banking Platform (IBMB).

At the same event, M. Nagaraju, Secretary, Department of Financial Services, said the government will soon launch a common startup hub portal to ease access to formal credit for startups. The portal, he said, will leverage AI and data-driven insights to help banks make faster and better lending decisions.

“Emerging technologies like AI are powerful enablers of innovation in the financial sector,” Nagaraju said. “They can enhance efficiency, broaden access, and deliver more customer-centric services.” He highlighted how AI-powered platforms like PSB 59 have already accelerated MSME loan approvals.

During a fireside chat with CRED founder Kunal Shah, NITI Aayog CEO B.V.R. Subrahmanyam described AI as a “true disruptor,” influencing finance at three levels — improving tasks (efficiency), changing processes (job substitution), and eliminating processes entirely (transformation).

“For a $30 trillion technology-driven economy, the financial sector will be massive,” Subrahmanyam said, adding that India’s scale, talent, and digital depth give it a unique global advantage in fintech.

He called for “innovation-friendly regulation”, suggesting regulatory sandboxes and a shift from “institution-based to activity-based frameworks.”

Subrahmanyam also highlighted inclusion and women’s participation as key growth drivers. “A 10% increase in women’s labour participation can boost GDP by 1.5%,” he said.

The Global FinTech Fest 2025, themed “Empowering Finance for a Better World Powered by AI”, is supported by several government departments and regulators, including the Ministry of Finance, RBI, SEBI, IRDAI, and IFSCA.Read about our editorial guidelines and ethics policy