INDIA Trends and Developments Contributed by: Sandra Lisa Philip, Shri Gayathri and Prashanth Shivadass, Shivadass & Shivadass
Shivadass and Shivadass 4/2 Millers Road Level 3 Bangalore 560052 India Tel: +91 80 4377 9955 Email: admin@sdlaw.co.in Web: www.sdlaw.co.in
AI and Privacy: What Is Next for India? Introduction
As AI becomes central to business growth and effi - ciency, organisations must focus not only on what AI can do but also on how it is used. This requires clear internal oversight, thoughtful data practices and an awareness of various privacy risks that arise from large-scale data use. Going forward, businesses that balance innovation with care and responsibility will be better suited to grow, build customer trust and stand out in the market. In the long run, trust and responsi - ble AI use will be key to becoming a leader in the AI market. AI Adoption Across Key Business Sectors in India Banking and financial AI is a widely used technology in the banking and financial services sector – statistics indicate that close to two thirds of banks and financial institutions operat - ing within India have already integrated AI into their operations ( Nasscom AI Index Adoption ). Banks have been developing their own “generative AI”; initially, its usage was restricted to customer ser - vices. Various chatbots have now been incorporated for rendering customer services and to provide finan - cial advice. Some banks also use AI robot tools and voice recognition tools to perform compliance checks, data entry, know-your-customer (KYC) verification, email responses and other customer support services. AI is also now being widely used in fraud detection to detect unusual patterns in banking, such as rapid micro-transactions or logins from suspicious devices. The Reserve Bank of India recently also launched the Digital Payments Intelligence Platform (DPIP), which harnesses AI to detect fraudulent transactions and
India is widely regarded as being in its “techade”, where technology is expected to drive economic growth and business efficiency. Artificial intelligence (AI) is already playing a central role in this shift. Indian businesses are no longer testing AI at margins but are actively using it across core operations to improve productivity, manage risk and scale faster. Industry reports (eg, Nasscom AI Index Adoption ) show that a significant number of Indian enterprises now have AI tools deployed in sectors such as banking, healthcare, retail, manufacturing and technology services. The adoption of AI poses a threat to human employment. For businesses, the attraction of AI lies in its ability to process large volumes of data quickly and turn it into useful actionables. AI is used to detect fraud, predict demand, personalise customer interactions, auto - mate internal processes and support management decisions that would otherwise require substantial time and human effort. In consumer-facing sectors, AI powers user algorithms, shopping indices, targeted advertising and recommendation engines, which influ - ence what customers see, buy and engage with. This rapid adoption of AI has made data a critical business asset. Most AI systems depend on continu - ous access to data, including customer information behavioural patterns and, sometimes, sensitive per - sonal details. As a result, questions around how data is collected, used and safeguarded are no longer a purely legal issue but are also a concern for board - rooms, since they directly affect trust and brand value.
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