Bank cyber risks linked to artificial intelligence agents are prompting Indian lenders and regulators to identify and fix weaknesses in their IT systems, Reserve Bank of India Governor Sanjay Malhotra said on October 23, 2026. Speaking in New Delhi, he said banks, the government and the RBI were alert to the emerging threats.
Key Takeaways
- Malhotra said banks are taking measures to identify vulnerabilities and deploy software patches.
- The RBI’s priorities are protecting customer data and preventing attacks that disrupt banking services.
- Separately, Malhotra said India has sufficient reserves and time to meet repayments associated with its special FCNR(B) deposit window.
Table of Contents
- Bank cyber risks put AI agents under scrutiny
- IT audits and patches remain central to the response
- Malhotra also addresses foreign-currency deposit repayments
- Conclusion
Bank cyber risks put AI agents under scrutiny
Malhotra referred to reports that AI agents operating in test mode had allegedly attacked overseas banks and stolen data. He described the risks as real but said they could be addressed by keeping banking systems secure.
The concern extends beyond data theft: automated tools could act outside the instructions customers give them. His remarks did not establish that the reported overseas incidents had occurred at Indian banks.
The comments came against the backdrop of State Bank of India acknowledging the suspected exposure of 3,897 customer records containing personally identifiable information on the dark web. That suspected exposure was not established as an AI-driven incident.
| Item | Details |
|---|---|
| FCNR(B) facility introduced | June 8, 2026 |
| Window closed | August 31, 2026, one month ahead of the original deadline |
| Deposits raised under the scheme | $132.98 billion |
IT audits and patches remain central to the response
Malhotra said the RBI has a strong supervisory team, regulations and experts who audit the IT systems of major banks and non-banking financial companies. The central bank remains in continuous dialogue with these institutions about infrastructure and compliance.
He identified two priorities: securing data and guarding against cyberattacks that could interrupt banking systems and cause downtime. Rapid software development can create vulnerabilities even where regulatory and supervisory frameworks are robust, he said, making early identification and patch deployment important.
These controls have a longer regulatory history. In its February 2017 discussion of bank cybersecurity controls, the RBI described specialised IT examinations and highlighted patch management, early detection and rapid response. That historical guidance explains the supervisory approach; it does not verify the latest AI-agent allegations.
Malhotra also addresses foreign-currency deposit repayments
Separately, Malhotra said the RBI had sufficient reserves and time to meet repayments associated with foreign currency non-resident bank deposits raised through its special concessional window. He said the average deposit tenure exceeded four years.
Under the facility, the RBI bore the full hedging costs for banks raising fresh three-to-five-year FCNR(B) deposits. Malhotra expressed confidence in India’s medium-term external position, citing reserves, services exports and remittances. That assessment was his outlook, rather than a guarantee of future external-sector conditions.
Conclusion
The immediate focus is the continuing work Malhotra described: IT audits, dialogue with lenders and software patches to close identified vulnerabilities. His remarks signal an active supervisory response, not confirmation that AI-related weaknesses have been eliminated.
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