Artificial intelligence is moving deeper into India’s banking sector, with a large share of financial institutions already using AI in live operations. A 2026 CXO survey by Zeta, based on responses from 40 CXOs across 18 banks and non-banking financial companies (NBFCs), found that 70% of chief digital officer respondents said their institutions were at either selective or scaled AI deployment.
The survey found that 30% of respondents reported scaled AI deployment. Adoption was strongest in customer service, fraud and risk analytics, document processing and software testing.
However, security and data privacy remain the biggest barriers to wider AI adoption. Technology and risk leaders identified these concerns as institutions move beyond bounded and reviewable AI use cases.
Most institutions surveyed allocate less than 10% of their new-project technology spending to AI. The survey also found that 4 in 10 digital leaders could not identify a high-ROI AI use case within their institutions.
“Indian banks have shown that AI creates value in production. The next challenge is making that success repeatable, and the survey is clear about what stands in the way: not conviction, but control,” said Sivaram Kowta, President, Zeta India.
“Banks have connected their core systems. The next step is to make them usable by AI, with banking context and permissions built in, and to put in place the identity, policy and audit controls that let risk and security leaders say yes with confidence. Banks that build these foundations once will find that the tenth deployment costs a fraction of the first.”
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