The Reserve Bank of India (RBI) has established the “Committee on Framework for Responsible and Ethical Enablement (FREE) of AI in the Financial Sector” to promote the responsible and ethical adoption of Artificial Intelligence in the financial sector. This initiative follows the developmental and regulatory policies announced in the RBI’s Monetary Policy Statement on December 6, 2024.
The committee will be chaired by Dr Pushpak Bhattacharyya, professor at IIT Bombay’s Department of Computer Science and Engineering. The committee has been tasked with assessing the current adoption of AI in financial services globally and in India, reviewing international regulatory approaches to AI in the financial sector, identifying potential risks associated with AI, and proposing frameworks for evaluation, mitigation, monitoring, and compliance. It will also recommend governance frameworks for ethical and responsible AI adoption in the Indian financial landscape and address other relevant matters concerning AI in the financial sector.
The committee is expected to submit its report within six months from its first meeting. This initiative highlights the RBI’s commitment to fostering innovation while ensuring ethical standards and risk management in the rapidly evolving domain of AI in financial services.
