Challenges and Opportunities of AI in Banking Sector

Abstract

This systematic literature review (SLR) conducts a comprehensive analysis of the challenges and opportunities arising from the application of artificial intelligence (AI) in the banking sector, in particular Special focus on Indian banks. The review reveals many opportunities to support AI, including the rise of fintech startups providing AI solutions, regulatory support for AI integration, as well as the benefits of personalized services digitalization, smart wallets, and improved decision-making capabilities. However, these opportunities come with notable challenges, such as job mobility, privacy concerns, reduced creativity and adaptability, and gaps in abilities, digital access. The article highlights the need for banking industry stakeholders to develop effective strategies to address these challenges and align AI initiatives with overall business goals. Additionally, the study highlights the lack of empirical research on AI in banking, emphasizing the importance of future research to expand the existing knowledge base and provide insights actionable identity for industry stakeholders. This study aims to provide insights into how Indian banks can leverage AI effectively while navigating the challenges inherent in its adoption. Keywords: Artificial Intelligence, AI adoption, banking sector, challenges, opportunities, fintech, regulatory support, job displacement, privacy concerns, digital access.