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RBI Deputy Governor Warns of AI Adoption Risks in Banking
ByAinvest
Monday, Sep 22, 2025 10:55 am ET1min read
RBI Deputy Governor M Rajeshwar Rao emphasized that AI adoption in banking must be done responsibly and with caution, with strong governance, ethical use, and alignment with long-term stability. Rao highlighted the importance of building a sustainable, AI-powered financial future with transparent and unbiased AI-driven decisions. He noted that RBI will continue to provide an enabling regulatory environment to build a banking system that transforms Bharat.
Grove Collaborative Holdings, Inc. (NYSE: GROV), a leading sustainable consumer products company, has taken a significant step towards integrating sustainable practices into artificial intelligence (AI) adoption. The company has announced a new open-source approach to measuring the environmental impact of AI, in partnership with Gravity, a leading carbon and energy management platform [1].The initiative, launched on September 22, 2025, aims to address the environmental costs of AI while promoting innovation. Grove Collaborative estimates that its 2025 AI-related emissions will equate to roughly 6% of last year’s business travel emissions, which is a small but significant environmental impact that the company is committed to mitigating [1].
The open-source formula developed by Gravity uses compute time, server power, and grid emissions factors to determine AI-related carbon emissions. This formula will enable other organizations to understand and reduce the environmental impact of their AI adoption [1]. Grove Collaborative is also committed to integrating AI emissions into its overall Scope 3 carbon reporting, investing in nature-based carbon offsets, and identifying opportunities for emissions reduction [1].
The initiative underscores the importance of responsible AI adoption, as highlighted by RBI Deputy Governor M Rajeshwar Rao. Rao emphasized that AI adoption in banking must be done responsibly, with strong governance, ethical use, and alignment with long-term stability. He noted that the Reserve Bank of India (RBI) will continue to provide an enabling regulatory environment to build a sustainable, AI-powered financial future .
By sharing its open-source AI emissions formula, Grove Collaborative is encouraging industry-wide accountability and transparency. The formula covers both large language model (LLM) queries and non-LLM AI tools, providing a comprehensive approach to measuring AI-related emissions [1].
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