In 2021, Indian fintech Zerodha’s CTO Kailash Nadh criticised superfluous, outsized “We’re powered by AI/ML” marketing which companies were running after. But the recent advancements in AI has altered the hobbyist software developer’s opinion as the company now deviated from its previously held ‘no AI approach’. 

Cut to present, isn’t Zerodha doing the exact same thing? To this, the self-taught coder Nadh said: “Marketing specifically, not usage.” 

Clarifying the same, he said companies have been legitimately using AI where they made sense for a long time. But the hype was fuelled by companies doing name-sake or bogus implementations and claiming to be powered by AI/ML.” 

Nadh has been researching and playing around with language models since the GPT-3/Copilot launch. But he agrees that the chat interface of course broke the flood gate, made it far easier to tinker and test, and also understand its potential impact on the world as large, which its viral adoption illustrates beautifully.

He further stated that Zerodha, founded in 2010 hadn’t found any use cases for AI/ML technologies up until the recent breakthroughs. “We might use where it makes sense, but the technologies have become so commoditised to integrate (literally takes minutes) that my earlier argument about superfluous marketing stands validated. Everyone will start using it and the claim will become meaningless,” he added.  

While the fintech company has very recently announced the integration of AI in their organisation, its competitors like TradeStation and Groww on the other hand have been using AI chatbot to automate manual workflows since half a decade ago. 

Is Zerodha late to the AI party? 

Two years ago, when AIM asked Nadh if Zerodha is using AI/ML, he said that it uses little to no AI or ML apart from some basic image/document recognition ML models for document processing. Now, Zerodha seems to be on the side of the fence, experimenting with GPT-4 and alike. 

“We’re just experimenting and doing small pilots. Text summarisation is a big use case for this industry. For example getting quick summaries of multi-page legal documents,” explained Nadh. 

With the currently identified use cases using a specific set of technologies, the company has estimated the tasks done by at least 20% (~200 people) can be fully replaced by AI automation. However, Nadh said the people at Zerodha needn’t be worried outright because the team has factored in this risk and created a policy that provides assurance. 

Though Zerodha seems to have taken a humane approach, the tech goliath IBM’s CEO Arvind Krishna said the company expects to pause hiring for roles it thinks could be replaced with AI in the coming years. Roughly 7,800 jobs could be replaced in the next five years as per the exec. 

The Fear of AI Replacing Humans Still Looms 

The fear of AI replacing humans is not new. At the recent Web Summit in Rio De Janeiro, AI Guru and founder of SingularityNET, Ben Goertzel vocally addressed that in the coming years AI could replace 80 percent of human jobs. 

But, how will we know in the future that the companies are not laying off employees because of performance or AI/automation basis? 

Nadh believes that layoff of human resources is neither a new problem, nor an AI-problem. A lot of people who are laid off never know the “real” reason behind those decisions. They could be easily the result of human bias. Either way, this issue, AI or non AI, can only be solved via organisational transparency. Management has to commit to being transparent about these decisions he suggested. Ergo, AI policy. 

Nadh opined, many companies will likely let go of employees and blame it on AI. In the process, companies will earn more and make their shareholders wealthier, worsening wealth inequality. “This isn’t a good outcome for humanity,” he added.

What’s the solution? 

A report by Goldman Sachs economists surfaced on the internet last month that stated generative AI could replace up to one-fourth i.e 300 million of current jobs globally. But the researchers listed workers in China, Vietnam and India are among the least likely to fall prey to the impact.

“It’s still important to understand the implications. It will affect existing opportunities obviously, but new ones might emerge,”  Nadh said. 

After the company released its policy, Nadh took to his blog to pen down the reasons why the company is finally going against its AI-first mindset. In the post titled ‘This time, it feels different’ Nadh stated, ‘Neither blockchain, serverless, web3, big data, nor earlier AI/ML technologies brought this about. But, the specific breakthroughs in the past few months finally did. All it took was 30 minutes to integrate, during which, it generated the code to integrate itself.’

He further noted that his excitement for these developments is overshadowed by growing fear. “Since there is so much that is unknown and alien about this, apart from, ‘let’s think this through and be very careful, I don’t know what advice can be given,” he concluded.