The banking sector and players in the space should be mindful of legal and cyber risks, and skill gaps emanating from Artificial Intelligence (AI), RBI Deputy Governor T Rabi Sankar has said.

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"With the adoption of AI and GenAI, laws are to be redefined. Industry needs to note that Digital Personal Data Protection (DPDP) Act rules are going to come soon, and banks may be in violation of some of it so it's important to start preparing for it," he said.

Addressing the 19th Annual Banking Technology Conference organised by the Indian Banks' Association (IBA) in Mumbai on Friday, he called upon banks to think of customer convenience and provide services accordingly.

"When rules are made by us, we need to think of making it convenient for customers and keep improving continuously," he said. Every new technology has erased few jobs but created newer ones, he said, adding that skilling and reskilling of the work force is a must.

NaBFID Chairman K V Kamath said what he had predicted 20 years ago has come true that banks will look like technology companies offering banking services.

There is need for banks to be resilient, adopt cloud-based solutions, Kamath said, adding that competition is the key challenge that banks are facing not just within banks but in the larger financial space.

IBA Chairman Atul Kumar Goel said GenAI opens doors to unprecedented opportunities for banking leaders, shaping the future of financial services.

Banks are already partnering with fintech companies to bolster their own digital transformation initiatives and keep up with startups that are successfully disrupting the banking industry, Goel, who is also Punjab National Bank MD, said.

The future is AI-driven, and the time to transform is now, Goel added. GenAI is poised to revolutionise banking by providing advanced insights into banking services, IBA CEO Sunil Mehta said.

Banks will leverage Generative AI to offer highly personalised experiences to their customers, enhancing the overall banking experience, he added.

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