Zerodha chief Nithin Kamath on Wednesday said the rise of AI (artificial intelligence) technology and deepfakes pose a large risk to the financial services industry.
While sharing a deep fake video of his, Kamath said it will only become harder over time to validate if the person on the other side is real or AI-generated.
“The tipping point for Indian financial services businesses was when onboarding became completely digital, thanks to Aadhaar, etc. For businesses onboarding a new customer, an important aspect is ensuring that the documents and the person opening the account are real,” Kamath said.
“The normal process followed is to fetch the ID or address proof data from the source using Digilocker and or Aadhaar. Also, match the face from this ID proof with the person opening the account through a webcam. Today, we have a bunch of checks in place to check for liveliness and if the other person is real or not,” he added.
But, according to Kamath, as the deepfakes improve, the process of validating and verification in financial services will keep getting tougher.
“It will be interesting to see how the regulations around this evolve. Going back to the physical way of opening accounts will bring the growth of the entire sector to an abrupt stop,” he said.
Nithin Kamath, who regularly tweets on all things markets, recently said the market regulator’s proposal to reduce the corporate bonds’ face value can lead to greater retail participation.
Sebi in a consultation paper floated the idea of permitting issuers to launch NCDs (non-convertible debentures) or NCRPS (non-convertible redeemable preference shares) with a face value of Rs 10,000.
The move is aimed at enhancing the participation of non-institutional investors in the corporate bond market. In October last year, the regulator reduced the face value of corporate bonds to Rs 1 lakh from Rs 10 lakh.
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