In its latest move to counter frauds in banking, Punjab National Bank (PNB) has announced its plan to implement AI in account reconciliation as well as using analytics to improve its audit systems. This nimble change comes after a debilitating fraud carried out by the pair of Nirav Modi and Mehul Choksi in February 2018, which almost paralysed the bank’s operation for a short time. The scam was perpetrated to a tune of approximately ₹20,000 crores, carried out over a number of years.
With the AI-enabled audit system in place, PNB aims to ensure improved security to its banking system to eliminate loopholes, in addition to gaining a stable growth for 2018. Sunil Mehta, Managing Director of PNB, said “The ‘business remodelling’ brought alive by changes at PNB is essential to ensure that the bank continues to grow and compete with its peers better” and is hopeful of the change for lesser human intervention.
Furthermore, the bank has also remodelled its underwriting process for credit to reduce fraudulent activities. The process is now divided into four components where different employees deal with different stages of the process to ensure authenticity. The internal audit system is also overhauled with new changes to focus more on off-site monitoring and less on manual inspection to check risks.
Earlier,foreign investors’ holdings to the bank were reduced significantly (from 12.5 percent to 9.1 percent stake) due to the Nirav Modi fraud. Thus, in order to gain traction in the market and to recover losses, the bank has said that it would focus on increasing low-cost current and savings accounts deposits to an estimate of ₹1 crore. PNB is aggressively focusing towards reskilling its employees and adopting new technology in its system.
Subscribe to our NewsletterGet the latest updates and relevant offers by sharing your email.
I research and cover latest happenings in data science. My fervent interests are in latest technology and humor/comedy (an odd combination!). When I'm not busy reading on these subjects, you'll find me watching movies or playing badminton.