The Reserve Bank of India has asked banks to adopt AI and strengthen customer service

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RBI emphasized AI and customer service for banks

Highlights

The Reserve Bank of India has advised adopting advanced technologies like AI, improving operational efficiency, and strengthening cybersecurity along with banking growth.
In the semi-annual meeting held on July 14, 2026, CEOs of public and private banks discussed issues such as CKYCR, MuleHunter, CBDC, ULI, Account Aggregator, FX Retail, and Retail-Direct.
The regulator indicated that AI, digital infrastructure, and anti-fraud measures will influence strategies for cost management, risk control, and customer outreach in the banking sector.

This article was translated from the original. Read the original version by our correspondent here.

Meeting Agenda and Regulatory Message

According to the Reserve Bank of India press release, this semi-annual meeting is held in Mumbai on July 14, 2026, attended by managing directors and chief executive officers of public sector and select private banks. The meeting is chaired by the Governor and attended by Deputy Governors Shri Swaminathan J., Dr. Poonam Gupta, Shri S. C. Murmu, and Shri Rohit Jain, along with executive directors responsible for supervision, regulation, enforcement, consumer education & protection, and financial inclusion.

In his opening remarks, the Governor highlights the broad-based growth in the banking sector and urges banks to continue meeting the needs of all segments and sectors of the economy with renewed enthusiasm and prudence. He advises banks to use advanced technologies, including AI, to expand reach, improve operational efficiency, reduce costs, and enhance customer experience, while also emphasizing the need to maintain robust cybersecurity, internal controls, and safeguards against fraud and data misuse.

The Governor also underscores the need to develop a culture of excellence in customer service and to keep customers at the center of banking operations. This message is especially important at a time when banks are trying to balance digital expansion with regulatory compliance.

Technology, Compliance, and Sectoral Impact

The meeting also discusses issues such as CKYCR, early detection of FICN, adoption or expansion of MuleHunter, CBDC, ULI, Account Aggregator, FX Retail, and Retail-Direct. Participants share their feedback on these topics as well as other issues broadly impacting the financial sector.

These discussions indicate that the regulator expects banks not just to grow, but to operate in a more secure, technology-enabled, and inclusive manner. The emphasis on AI, digital public infrastructure, and anti-fraud systems could impact future strategies for cost management, risk control, and customer outreach in the banking sector.

Our previous report summarized the RBI's daily data on merchant and inter-bank forex market transactions during June 1–5, 2026, showing the direction and levels of FCY/INR spot, forward, and swap transactions. These figures indicated active hedging, funding, and short-term liquidity management by banks in the inter-bank segment through large swap/spot volumes, as well as fluctuations in customer-based hedging demand in the merchant segment.

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