Reserve Bank of India (RBI) governor Sanjay Malhotra recently asked banks to leverage advanced technologies, including Artificial Intelligence (AI), to expand their reach. While it is important to streamline complex workflows, detect fraud in real time, and deliver personalised customer service, Rohit Arora, CEO and co-founder of Biz2Credit and Biz2X, believes jobs will also be at risk because many operational roles in the banking industry involve structured, repetitive processes.
“Anything which is structured, anything which is repetitive, is the easiest thing for AI to automate. Bank branches could consequently require fewer employees as more customer services migrate to digital platforms and AI-powered systems,” Arora said while speaking to India TV Digital.
Despite the rapid development of AI, he acknowledged that the technology still has limitations and that its biggest near-term impact may not be the complete replacement of banking employees, but the automation of portions of their workload.
Meanwhile, Anthropic recently stated that the advanced AI systems could soon be able to improve themselves and build new, even stronger versions, which might not need any human input.
Number of bank branches to go down
According to Arora, the number of new bank branches opening in India has declined, and it will continue to decline as more customer services migrate to digital platforms and AI-powered systems.
“We’ll see more layoffs; we’ll see more branches which are either smaller or less staffed,” he said. However, he stressed that technology could create new roles. He pointed to areas such as prompt engineering and technology specialists who work directly with businesses as examples of emerging opportunities.
Will use of AI make loans cheaper?
Arora believes AI could streamline significant portions of the loan process; however, human involvement would not disappear.
“The efficiency gains could eventually translate into benefits for borrowers, although lower costs are not guaranteed,” he said.
Will credit score be relevant in the era of AI?
Rohit Arora strongly believes that the growing availability of financial data could also change the role of traditional credit scores, particularly in business lending.
“I would say, yes, and no. I am saying yes, if you consider it only as a sort of indicator. I am saying no in cases of business lending,” he said.
“Cash flow is never captured by a credit score, so cash flow is something that you can look into the bank statements. You can look into the financial statements. Then, that’s where AI is going to play a very big role,” Arora added.
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