AI, Cyberattacks And Financial Stability: Why RBI And SEBI Must Act Now |
There has been considerable debate about whether artificial intelligence (AI) will eventually become an existential threat to humanity. Some believe increasingly powerful machines could escape human control, while others dismiss such fears. Whether these predictions materialise is debatable, but one threat is no longer theoretical—AI is transforming cybercrime, with serious implications for banking, financial markets, and economic stability.
In India, cyber incidents involving smaller NBFCs reportedly resulted in losses of nearly ₹300 crore over two months, with around 150 complaints and FIRs. Attackers exploited vulnerabilities in APIs and payment infrastructure to initiate unauthorised transfers. The incident involving the country's largest lender, SBI, is equally instructive. Recently, SBI disclosed a suspected data breach. Preliminary examination identified thousands of records containing personal information, including names, telephone numbers, addresses, and loan-related details. Although core operations and customer balances remained unaffected, the incident raises questions about data security and third-party access.
South Korea has reported breaches involving 16 financial institutions and approximately 100,000 exposed records. In Italy, fraudsters reportedly used an AI-replicated voice and fraudulent WhatsApp communication, impersonating a senior executive, to induce a banking institution to transfer €95 million, much of which remained unrecovered.
The recent Binance incident also offers an alarming illustration. A week ago, hackers reportedly stole approximately $6.3 billion in cryptocurrency from the exchange's hot wallets across multiple blockchains. Investigations pointed to a compromised DevOps engineer's laptop and unauthorised access to internal systems and wallet signing infrastructure. On Ethereum, attackers reportedly exploited an account delegation feature to........