Sustainable Banking in the Digital Era: AI, Ethics, and Financial Inclusion in a Globalized Economy

Authors: SARITA CHOUHAN, Dr. Mahendra Singhai

DOI: https://doi.org/10.37082/IJIRMPS.v13.i4.232635

Short DOI: https://doi.org/g9stkc

Country: India

Full-text Research PDF File:   View   |   Download

Abstract: This article analyzes the dynamic convergence of AI, ethical regulation, financial inclusion, and green banking in a rapidly changing digital world economy. It assesses the effect of AI-generated innovations like machine learning, predictive analytics, and automation on fundamental banking functions such as risk management, credit disbursement, customer engagement, and compliance. Though these technologies promote efficiency, they raise ethical issues around data privacy, algorithmic bias, and transparency. The work supports a human-focused AI model that provides justice, accountability, and trust in financial choice-making.

The study also explores the emergence of green finance and the increasing uptake of environmental, social, and governance (ESG) approaches by banks. With an increase in climate risks, institutions are increasingly adopting green bonds and sustainability-linked investments. The research evaluates how these instruments promote the United Nations Sustainable Development Goals (SDGs), specifically in the financial sector in India.

A central cornerstone of this shift is digital financial inclusion. The paper discusses how technologies such as mobile banking, UPI, and credit systems driven by AI are broadening access for underserved groups and MSMEs, along with regulatory and infrastructure challenges. Embracing a mixed-methods research method, comprising case studies and policy analysis, the study provides strategic suggestions to construct an inclusive, sustainable, and ethically driven banking future.

Keywords: Keywords: Artificial Intelligence (AI), Digital Banking, Financial Inclusion, Green Finance, ESG (Environmental, Social, and Governance), Sustainable Development Goals (SDGs), Ethical AI, Human-centric AI, Digital Transformation

Paper Id: 232635

Published On: 2025-07-11

Published In: Volume 13, Issue 4, July-August 2025

Share this