Digital payments are growing steadily across India. More than 750 million UPI (Unified Payments Interface) transactions are processed every day. Artificial Intelligence (AI) is expected to play a crucial role in increasing this number to one billion daily transactions and bringing the next 500 million users onto the UPI platform. With the rapid growth of digital transactions, India needs a stronger regulatory framework. In case of any dispute or fraud, it will be possible to verify the instructions a user gave to an AI system and the actions or transactions that were authorized. This presents a significant opportunity for fintech companies to develop Small Language Models (SLMs). India already has a vast amount of data, which banks and fintech firms can use to build advanced AI-powered tools. For example, NPCI's 'Fimi' model is already resolving payment-related issues for millions of customers within seconds. NPCI, the RBI, and the Government of India are working together to strengthen this ecosystem. AI will also be used extensively to prevent fraud, detect fake accounts, and enhance the security of existing users.
DATTAPRASAD SHIRODKAR, Mumbai
