Hardik Shah of Boston Consulting Group highlights the need for stronger governance, collaborative security, and infrastructure investment as Indian banks prepare for transformative AI adoption, amid growing cyber risks.
Artificial intelligence is set to transform Indian banking over the next decade, but Hardik Shah of Boston Consulting Group says the industry will need stronger governance, tougher cyber defences and more shared infrastructure if it is to adopt the technology safely. Speaking on the sidelines of FIBAC 2026 in New Delhi, Shah said banks could not simply automate existing processes and expect meaningful gains; instead, they would need to redesign how work is done while keeping human oversight and control at the centre.
Shah warned that cyber risk is one of the biggest obstacles to wider AI adoption. He said the cost of launching attacks has fallen sharply while the speed and scale of attacks have risen, making security a challenge that no single lender can manage alone. He argued that banks, regulators and the government would need to work together on industry-wide utilities, higher investment and a much stronger security posture.
His comments reflect wider concerns raised in BCG’s work on India’s financial sector. The consultancy’s recent research on cybersecurity in banking, financial services and insurance said AI-enabled attacks are now a top priority for many security chiefs, while a joint BCG and Data Security Council of India report said attacks across the sector are running at 1.6 times the global average and have more than doubled in four years. The same research points to shared vendor ecosystems and slower response cycles as key vulnerabilities.
BCG has also said AI could reshape 35% to 50% of roles in Indian banking, underlining the scale of the disruption ahead. Shah said the opportunity is not just efficiency but inclusion, especially in credit for small businesses and agriculture, where high servicing costs have kept loan prices elevated. He said AI could help lower those costs, but only if banks build proper governance, create controlled testing environments such as an AI sandbox and train risk and analytics teams to manage the new risks.
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