Artificial intelligence is opening doors for efficiency, inclusion, and resilience, said Ajay Kumar Choudhary, non-executive chairman and independent director, National Payments Corporation of India (NPCI), in Mumbai on Tuesday. “Artificial intelligence has moved from the margins to the mainstream. It is reshaping how we design, deliver, and experience financial services, opening doors for efficiency, inclusion, and resilience,” he said during his special keynote address at the 6th Global FinTech Fest (GFF) 2025.

Speaking on the fest's theme of “AI’s Promise and Peril: Building Responsible Intelligence for Inclusive Finance”, he emphasised that while AI unlocks unprecedented opportunities, it also introduces complex challenges that demand prudent governance and cross-border collaboration.

He observed that investment in AI across banking, insurance, capital markets, and payments is projected to reach nearly $100 billion by 2027, with 78% of financial organisations already deploying AI in at least one function, a significant increase from 55% in 2023. “The industry is no longer debating if AI will matter; it is preparing for how far and how quickly it will take us. The real question is whether we harness this power carefully," he said.

Highlighting two critical dimensions of the AI revolution, Generative AI, which creates and analyses at scale, and Agentic AI, which can autonomously pursue complex tasks, Choudhary underlined their transformative potential for fraud detection, compliance automation, trading precision, and customer engagement. Early studies suggest global banks could see productivity gains of $200–340 billion annually through these technologies.

He also warned about AI-related vulnerabilities, such as model bias, explainability gaps, concentration risks, and systemic dependencies across infrastructure layers, from specialised chips to cloud, data, and large foundation models. Global standard-setting organisations, like the Basel Committee, the IMF, and the BIS, have cautioned that unchecked AI adoption could increase financial cycle volatility and systemic risks.

He further explained that the AI ecosystem rests on five interdependent layers, i.e., specialised chips, cloud platforms, vast datasets, foundation models, and end-user applications. Today, one company produces about 90% of advanced processors, three firms control most global cloud capacity, and only a handful of entities dominate foundation models. Such systemic dependencies, he cautioned, affect not only financial resilience but also economic sovereignty and national security, and must be addressed proactively through diversification and robust governance.

He also highlighted India’s leadership in inclusive innovation, citing the transformative scale of the Unified Payments Interface (UPI), which now processes over 20 billion transactions a month.

Choudhary showcased NPCI’s initiatives such as ‘UPI Lite’ for low-bandwidth regions, ‘UPI for Her’ empowering women entrepreneurs, and ‘UPI 123Pay’ enabling feature phone users. NPCI’s federated AI models are being piloted to combat fraud without sharing sensitive data, while real-time mule account detection is strengthening payment integrity.

He further shared NPCI’s vision to support sovereign, interoperable real-time payment systems through NPCI International, expand UPI and RuPay acceptance globally, and build affordable, secure cross-border remittance corridors aligned with the G20 objective.

He also announced upcoming digital payment innovations to enhance security, transparency, and ease of use, including the launch of Bharat Connect’s Internet & Mobile Banking Platform (IBMB) to standardise merchant payments across online channels. He highlighted NPCI Tech Solutions Ltd (NTSL) as a new hub for deep-tech experimentation and breakthrough innovation.