ETHICAL IMPLICATIONS OF ARTIFICIAL INTELLIGENCE IN FINANCIAL DECISION-MAKING

International Journal of Computer Science (IJCS) Published by SK Research Group of Companies (SKRGC)

Abstract

artificial Intelligence (AI) is reshaping financial decision-making across domains such as credit scoring, trading, insurance underwriting, fraud detection, and wealth management. While AI systems provide substantial improvements in efficiency, scalability, and predictive accuracy, they also introduce significant ethical concerns. These concerns include algorithmic bias, lack of transparency, accountability gaps, privacy risks, and the amplification of systemic financial instability. This paper presents an in-depth examination of these ethical implications, situating them within established moral frameworks and contemporary financial practices. It further develops a comprehensive governance model integrating technical, organizational, and regulatory mechanisms. The paper argues that ethical AI in finance is not merely a compliance requirement but a foundational necessity for sustainable and equitable financial systems.

References

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Keywords

Artificial Intelligence (AI); Financial Decision-Making; Algorithmic Bias; Fairness in Machine Learning; Explainable AI (XAI); Transparency; Accountability; Ethical AI; Credit Scoring; Algorithmic Trading; Financial Risk Management; Data Privacy; Differential Privacy; Governance Frameworks; Regulatory Compliance; Systemic Risk; Automation Bias; Human-in-the-Loop Systems; Responsible AI; Financial Ethics.