Impact of Artificial Intelligence in the Indian Banking system -A case study on State Bank of India , Hyderabad region

Abstract

Artificial Intelligence (AI) has become a key driver of transformation in the Indian banking sector by improving operational efficiency, strengthening fraud detection, enhancing risk management, and enabling personalized customer services. The rapid digitalization of banking, increasing financial frauds, and stricter regulatory requirements have accelerated the adoption of AI tools such as machine learning, chat bots, robotic process automation, and predictive analytics. This study reviews existing literature to examine the impact of AI on Indian banks, with a special focus on the State Bank of India (SBI). The findings indicate that AI significantly reduces manual workload, improves transaction security, and supports data-driven decision-making. However, challenges related to data privacy, cyber security, and skill gaps remain, highlighting the need for responsible and well-governed AI adoption. Researchers emphasize the need for responsible AI governance, transparent algorithms, and continuous employee training to mitigate these risks.
Overall, the reviewed studies suggest that Artificial Intelligence is reshaping the Indian banking landscape by enabling smarter, safer, and more customer-centric financial services. This research builds upon existing literature to understand the collective impact of AI on banking operations, fraud management, and consumer response, with a specific focus on SBI and the Indian banking ecosystem.