Experts at the Business Standard BFSI Insight Summit in Mumbai said AI will change banking forever. HDFC Bank’s Ramesh Lakshminarayanan noted, "An AI bank is going to come, whether we like it or not." Banks must now prepare for this shift, as autonomous agents will soon handle many complex tasks.
Left to right: Shivani Shinde, Business Next's Nishant Singh, Accenture's Paritosh Wechalekar, PNB's Rajesh Prasad, Axis Bank Group's Sameer Shetty, HDFC Bank Group's Ramesh Lakshminarayanan.
Artificial intelligence (AI) and agentic AI will give banks a competitive advantage but will also force them to reassess the balance between risk and agility, said Ramesh Lakshminarayanan, group head of information technology and chief information officer at HDFC Bank. He was speaking at a panel discussion on 'Autonomous Banking & Security' on the second day of the three-day Business Standard BFSI Insight Summit in Mumbai.
"An AI bank is going to come, whether we like it or not. It is not going to be 200,000 employees; it will probably have 200 employees. We have to get ready for this. Whether this happens in two years or five years, we do not know, but banks have to be prepared for it," Lakshminarayanan said.
All banks in India, including those that have transitioned from manual to digital banking, can implement the changes likely to come with the introduction of AI and autonomous banking agents, said Rajesh Prasad, a director at Punjab National Bank. He added that while these autonomous agents would be integrated into bank systems, a human pilot would continue to oversee their operations.
The introduction of AI into banking systems will also make it easier for customers to switch to banks that use these technologies more effectively, said Sameer Shetty, group head of digital business and transformation and strategic programme at Axis Bank.
Instead of obtaining all their services from a single bank, customers may choose different banks for different needs, such as opening a savings account with one bank and taking a loan from another, Shetty said.
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Unlike in the days of manual and digital banking, when customers had to fill out forms by hand or on a computer, AI and autonomous agents will simplify the process by handling such tasks, he said.
To make the most of AI and autonomous agents, banks will need to establish appropriate guardrails and set clear boundaries for their agents, said Paritosh Wechalekar, managing director of technology services for India.
"Drawing these boundaries is of prime importance in the AI and agentic world. The regulator is always saying that you have to do a risk tiering when you identify the use cases. And when banks do that risk tiering, they have to identify the boundaries as well and work towards them," Wechalekar said.
The advent of autonomous banking will transform the way banks operate, but lenders will need to learn to act, judge and simulate while accounting for new rules developed by AI agents, said Nishant Singh, founder and chief executive officer of Business Next.
While AI will not change the risk boundaries set by banks, the decision on whether to continue applying manual rules within those boundaries or follow the learning and outcomes suggested by agentic AI will rest with the banks, Singh said. This, he added, will be a crucial step towards becoming truly autonomous banks.