{
  "id": 632990,
  "title": "India’s central bank wants AI to approve loans that humans would reject",
  "url": "https://urgent.news/2026/08/12/indias-central-bank-wants-ai-to-approve-loans-that-humans-would-reject-632990",
  "topic": "ai",
  "section": "AI",
  "published": "2026-08-12T01:18:21.000Z",
  "source": {
    "name": "The Register Science",
    "slug": "the-register-science",
    "url": "https://www.theregister.com/ai-and-ml/2026/08/12/indias-central-bank-wants-ai-to-approve-loans-that-humans-would-reject/5286572"
  },
  "original_language": "en",
  "account": "India's central bank, the Reserve Bank of India, is advocating for the adoption of artificial intelligence (AI) to approve loans that human assessors might reject. At a recent conference in Mumbai, the governor, Sanjay Malhotra, argued that AI can be responsibly harnessed as a valuable tool, rather than merely a risk to be contained. He highlighted several reasons for this stance, including the difficulty banks face in justifying loans to first-time borrowers, gig workers, and small businesses without formal financial records. AI models can analyze alternative data, such as cash flows and utility payments, to extend credit to a larger portion of India's population. This would be especially beneficial for those who are currently underbanked or lack access to traditional banking services. AI can also help identify borrowers at risk of default early enough to provide counseling instead of just recovery efforts. Malhotra believes that AI can make banks more inclusive by developing voice interfaces in local languages and improving customer service through AI-assisted decision-making and personalized financial guidance. However, he is mindful of the potential risks associated with AI, such as the \"black box problem,\" where advanced AI models lack transparency in their reasoning. He also warns about the possibility of AI perpetuating biases against certain demographics and the risks of relying on a few tech companies for AI solutions. To mitigate these risks, Malhotra outlined expectations for Indian banks to use AI responsibly. These include maintaining an inventory of all AI systems in use, establishing board-approved AI governance policies, building capacity to explain AI-driven decisions, and conducting regular stress-tests and red-team evaluations. Ultimately, Malhotra believes that the banks that will excel in the AI era will be those that adopt the technology with a deep understanding of its implications, clear accountability for outcomes, and a strong commitment to maintaining customer trust.",
  "summary": "Regulator hopes for greater financial inclusion, without extra risk or blaming models for bad decisions",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 2,
    "also_reported_by": [
      {
        "outlet": "The Register",
        "title": "India’s central bank wants AI to approve loans that humans would reject",
        "url": "https://urgent.news/2026/08/12/indias-central-bank-wants-ai-to-approve-loans-that-humans-would-reject",
        "published": "2026-08-12T01:18:21.000Z"
      }
    ]
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}