RBI Governor Puts Cyber Risks from AI Above Asset Bubble Worries

Mumbai, October 7: Reserve Bank of India Governor Sanjay Malhotra on Wednesday said cyber risks arising from the growing use of artificial intelligence stand out as the biggest worry for central banks. He made the comments while responding to questions after the central bank highlighted elevated AI-related asset valuations among the downside risks to the global economy.

Malhotra noted that several risks linked to AI are material. These include the possibility of sharp corrections in asset prices, disruption in labour markets and wider effects on financial stability. For those charged with safeguarding the financial system, however, cyber threats take clear priority.

“All these risks are material. I think for us as central bankers, the most significant of these is cyber risks,” the Governor said. He explained that financial systems today rely heavily on information technology and operate without clear borders. Institutions interact constantly across geographies. AI introduces an additional layer of complexity to this already interconnected environment.

Malhotra added that the RBI is working to strengthen its systems so that cyber risks can be better prevented and mitigated. The comments came during the post-policy press conference following the Monetary Policy Committee meeting. In his earlier remarks, the Governor had listed continuing elevated AI-related asset valuations, high public debt and possible further tightening of global financial conditions among the significant downside risks, especially with the West Asia conflict still unresolved.

The observation arrives as Indian universities and colleges expand programmes in artificial intelligence, data science, fintech and cyber security. Students preparing for careers in banking, technology and financial regulation now face a landscape where understanding digital vulnerabilities is becoming as important as mastering core subjects. Teachers and institutions that already include modules on data protection and ethical AI use may find the RBI’s emphasis useful for updating classroom discussions.

Parents guiding children toward professional courses in technology or finance can also note the central bank’s focus. Cyber resilience is no longer a specialised concern limited to IT departments. It sits at the centre of how the country’s financial system views emerging technology. For young people considering roles in policy, risk management or compliance, the message from the RBI is straightforward: vigilance around AI-driven threats will remain a priority for years ahead.

The Governor’s remarks reinforce that while AI continues to reshape markets and open new opportunities, the institutions responsible for stability are treating its security implications with particular seriousness. Indian education systems that prepare the next generation of professionals will need to keep pace with this reality.