Published Paper Details:

The rapid integration of Artificial Intelligence (AI) and Machine Learning (ML) has introduced vulnerabilities within India's FinTech sector. These vulnerabilities are mainly adversarial attacks, deepfake fraud, and algorithmic bias. This current study has done a qualitative document analysis to evaluate the alignment of AI risks affecting the fintech sector and the regulatory framework of the Reserve Bank of India (RBI). The study has found that the RBI has a robust governance layer. The RBI requires banks to use outsourced services with strict liability, consumer consent, and full accountability. However, this study has found that RBI policies have largely failed to implement specific technical and model-level safeguards. For core practices like mandatory algorithmic fairness audits, model robustness testing, and specific methodologies for explainability, there is no binding requirement in RBI's regulatory framework. The study finally concludes that RBI has existing strong governance principles. Therefore, RBI's framework must evolve to integrate granular technical standards. This creates a safeguard for the digital financial ecosystem against complicated threats of modern AI and Generative AI systems.