The Reserve Bank of India (RBI) has released the FREE-AI Framework - a forward-looking blueprint to guide the responsible and ethical adoption of Artificial Intelligence in the financial sector. Developed by a high-level committee, the framework is grounded in seven foundational principles or "Sutras" that emphasise trust, fairness, accountability, and sustainability.
The FREE-AI Framework is structured around six strategic pillars: Infrastructure, Policy, Capacity, Governance, Protection, and Assurance. These pillars are designed to balance innovation with risk mitigation. The framework includes 26 actionable recommendations, ranging from establishing AI innovation sandboxes and indigenous financial AI models to implementing robust governance, audit, and incident reporting mechanisms.
As AI becomes integral to financial services-from credit underwriting to fraud detection-the FREE-AI Framework ensures that its deployment is inclusive, transparent, and secure. It also addresses sector-specific challenges such as data privacy, algorithmic bias, and cybersecurity, while promoting innovation that supports financial inclusion and systemic resilience.
