RBI plans AI-driven digital payments intelligence platform to flag risky transactions

In a move aimed at strengthening the security of India’s rapidly growing digital payments ecosystem, the Reserve Bank of India (RBI) is implementing a new “Digital Payments Intelligence Platform” that will leverage artificial intelligence to identify potentially risky transactions before they are completed.

Speaking to the press after the Monetary Policy Committee (MPC) meeting, RBI Executive Director Sanjay Malhotra said the platform is currently under development, with a prototype being built by the central bank’s innovation hub.

An entity is also being set up to operate the system once it is launched, he added.

“The idea is to gather information from all available sources and train an AI system on this data,” Malhotra explained.

“This system will flag potentially risky transactions in real time. Based on these alerts, either the customer or the bank can decide whether to proceed with the transaction. We expect this to have a meaningful impact in reducing fraudulent activity in the system," he said.

While stressing that fraud levels in India’s digital payments space remain low, Malhotra noted the need for continued vigilance.

“If you look at the number of fraud cases relative to total transactions in UPI and similar platforms, they remain well under control. But with the exponential growth of digital payments, ensuring security is a priority,” he said.

India’s digital payments market has seen meteoric growth in recent years, driven by the popularity of UPI, mobile wallets, and QR-based payments. According to the National Payments Corporation of India (NPCI), UPI transactions crossed Rs 14 trillion in September 2025 alone.The RBI has not yet disclosed a timeline for the platform’s rollout, but the prototype’s development is already underway.