Cooperative banks must embrace Artificial Intelligence (AI) and emerging technologies to remain competitive in the fast-changing banking landscape, said Biswajit Phukan, Chairman of the Assam State Cooperative Bank, while addressing the Summit in Lucknow on Saturday.
Phukan cautioned that technology adoption is no longer a matter of choice for cooperative banks. “AI is being discussed across the banking industry. If cooperative banks do not move forward with AI and new technologies, large commercial banks will continue to expand and capture our market share,” he said.
At the same time, he stressed that AI should not be seen as a threat. “AI is not our enemy. The biggest strength of cooperative banks is their close relationship with farmers, self-help groups (SHGs), and priority sector borrowers. If we combine this grassroots connect with AI-driven solutions, cooperative banks can move much further ahead,” he remarked.
Highlighting the rapid pace of technological change, Phukan noted that developments once considered impossible are becoming reality within months. He urged cooperative banks to prepare for a future where digital transformation will shape every aspect of banking operations.
According to him, attracting younger customers will require modernization of services and processes. Since lending remains the core business of cooperative banks, AI can significantly improve credit assessment, customer outreach, and efficiency in priority sector lending.
Responding to concerns about job losses, Phukan said AI should be viewed as a support system rather than a replacement for employees. “Technology and staff must move together. AI can help banks become more efficient while enabling employees to focus on higher-value tasks,” he said.
He pointed out that AI has the potential to strengthen fraud detection, cybersecurity, risk management, and customer service, leading to higher customer satisfaction and better operational resilience.
Citing an example from Assam, Phukan said a bank in Guwahati has already launched an AI-driven branch with minimal human intervention, showcasing the possibilities of advanced technology in banking.
However, he acknowledged that high implementation costs remain a challenge for cooperative banks. To overcome this, he advocated the creation of a common technology platform that would allow cooperative institutions to access modern digital solutions at an affordable cost while preserving their cooperative character.
