India’s fintech industry is entering a new era where AI becomes central to decision-making, automating services and enhancing financial inclusion, driven by robust digital infrastructure and supportive policies.
India’s fintech sector is moving into a new phase in which artificial intelligence is no longer just a back-office aid but a core layer of decision-making, automation and service delivery. A joint paper from ASSOCHAM and KPMG in India, released at the 3rd India International Fintech Festival, argues that the country is well placed to lead this shift because of its digital public infrastructure, rising connectivity and large-scale data systems.
The report says digital identity, instant payments, consent-based data sharing and secure digital records create the conditions for AI to be deployed at scale across financial services. It adds that lenders, insurers and payments firms are moving beyond small trials and beginning to embed AI across customer service, fraud detection, compliance, risk controls and operational decision-making.
KPMG India partner and national leader for clients and markets, Akhilesh Tuteja, said India has already built a strong digital finance base, powered by public infrastructure, widespread adoption and a supportive policy environment. He said AI is emerging as the next major force, allowing financial firms to make faster decisions and run more adaptive systems. Hemant Jhajhria, KPMG India’s head of consulting, said the country’s financial story has been built on trust at population scale, and that richer transaction, identity and behavioural data are now turning AI into an intelligence layer that can convert information into action.
The paper identifies several priorities if the sector is to make that transition successfully. It calls for more compute capacity, stronger privacy and cyber security rules, and wider use of AI in lending, underwriting and claims processing. It also points to the need for voice-first and vernacular interfaces, which could make digital finance more accessible to people who are less comfortable with English or traditional app-based services.
The broader policy direction is also becoming clearer. According to another KPMG paper on artificial intelligence for Bharat, India’s digital infrastructure gives it an advantage in scaling inclusive AI systems, but only if governance keeps pace with innovation. KPMG’s separate study on financial crime warns that generative AI can improve fraud detection, anti-money laundering checks and know-your-customer processes, while also raising the bar for oversight. ASSOCHAM secretary general Saurabh Sanyal said the convergence of AI, digital public infrastructure and progressive regulation offers an opportunity to deepen inclusion and strengthen India’s position in digital finance, while a related ASSOCHAM statement from MeitY secretary S. Krishnan highlighted the role of the AI Mission, the National Supercomputing Mission and the India Semiconductor Mission in turning AI ideas into scalable systems.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
