AI can amplify challenges for data protection, cybersecurity - SEBI Pandey
This story was originally published at 13:41 IST on 21 August 2025
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NEW DELHI – Increased adoption of artificial intelligence could amplify existing challenges pertaining to data protection and cybersecurity, among other matters, Securities and Exchange Board of India Chairman Tuhin Kanta Pandey said Thursday. The regulator, market intermediaries, and companies "have to think of AI as an assist (and) not a substitute for judgement", Pandey said at a capital market conference organised by the Federation of Indian Chambers of Commerce & Industry here.
Pandey asked whether companies and market intermediaries, and their boards, are equipped to provide guidance on responsible AI adoption, and to balance innovation with accountability. The SEBI chief said the question must be asked - innovation for what. He said innovation must cut friction in the markets, and deepen and diversify them.
"Innovation in capital market must lower friction and compliance costs for issuers, investors, and intermediaries while managing the risks... (and) also provide diverse range of opportunities depending upon risk appetite," Pandey said at the event. Such a high bar must be set by market participants and companies introducing innovative products and technologies.
SEBI's own innovative regulatory approach has helped establish a new class of investors, new asset classes, and new methods of raising risk capital, Pandey said. On the positive side of AI, Pandey noted it "has the potential to unlock new forms of customer engagement, enable alternative approaches to risk assessments, monitoring, fraud detection, and financial inclusion." End
Reported by Rajesh Gajra
Edited by Tanima Banerjee
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