# RBI FREE-AI Framework for Responsible AI in Finance

> India

The RBI's FREE-AI Committee submitted its report on 13 August 2025, setting out 7 Sutras (guiding principles) and 26 recommendations across six pillars - Infrastructure, Policy, Capacity, Governance, Protection and Assurance - for responsible AI adoption by banks, NBFCs and other regulated entities. These are Committee recommendations, not yet binding RBI directions, but RBI has signalled it may issue consolidated AI Guidance built on them. We help REs get ahead of the recommended board-approved AI policy, model governance, red-teaming and audit expectations now.

## Who needs to comply

Banks, NBFCs, AIFIs and other RBI-regulated entities deploying or evaluating AI/ML systems - and their AI/technology vendors.

## Key requirements

- **7 Sutras, 26 recommendations** - Trust, People First, Innovation over Restraint, Fairness and Equity, Accountability, Understandable by Design, and Safety/Resilience/Sustainability, operationalised under six pillars.
- **Not yet binding - but a clear signal** - A Committee recommendation (13 Aug 2025), not an RBI Master Direction. Recommendation 6 proposes RBI issue consolidated AI Guidance built on these Sutras - expect it to firm up.
- **What REs should build now** - A board-approved AI policy, AI model inventory, risk-based red-teaming and audit framework, and AI incident reporting - the recommendations with the clearest audit trail.

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