ROLE OF ARTIFICIAL INTELLIGENCE IN FINANCIAL SERVICES OF SELECTED BANKS

Abstract

This study examines the role of Artificial Intelligence (AI) in the financial services industry, with particular reference to its application in banking, investment, insurance, and customer service in India. The study is descriptive in nature and is based on primary data collected from 100 respondents with knowledge of AI and financial services, using a structured questionnaire, supported by secondary data drawn from published reports, journals, and official industry sources. The study examines respondents’ awareness and perception of AI across key application areas — fraud detection, credit scoring and risk assessment, robo-advisory and investment decisions, financial inclusion, customer service, and regulatory adequacy — together with concerns relating to data privacy and the transparency of AI-based decision-making, using percentage analysis and tabulation to summarise the collected data. The results show that a large majority of respondents view AI as effective in detecting financial fraud, reducing operational costs, and improving customer service and personalisation, while a substantial proportion also express concern about data privacy and the transparency of AI-based decisions, and remain uncertain about the adequacy of existing regulatory frameworks. The study concludes that AI has become a significant driver of efficiency, financial inclusion, and customer experience in financial services, and that its continued adoption should be accompanied by stronger data protection, greater transparency, and clearer regulatory guidance to sustain customer trust.