Analysis · Financial Services

PayU CTO shifts focus to ai risk management

By Startup Enthusiast · 29 June 2026

What they do

PayU uses AI for fraud detection and customer support in the fintech sector

CTO Narendra Babu says discussions have moved from cost to managing vendor risks

The company advocates a hybrid approach using proprietary models alongside open-source tools

Enterprise AI adoption spans customer support, software development, and financial operations.
Companies face risks like restricted model access, pricing changes, and geopolitical restrictions.
Open-source models are viewed as strategic assets for flexibility and operational control.
PayU CTO Narendra Babu highlights a shift from cost management to risk management.
Organizations must prepare for uncertainty rather than assuming uninterrupted third-party access.
A hybrid strategy combines frontier proprietary models with open-source solutions for routine workloads.
Proprietary models offer superior performance and reasoning capabilities for complex tasks.
Open-source models provide portability and the ability to switch providers easily.

Third-party AI risks include data storage on external servers and cybersecurity vulnerabilities.
AI vendors may seek rights to use customer data, raising IP ownership questions.
Using open-source models on own infrastructure improves compliance and data governance control.

PayU operates in the fintech sector providing payment processing services.
The company utilizes AI for fraud detection and internal operational efficiency.
AI supports customer interactions and decision-making workflows within the organization.
Compliance and regulatory adherence are key areas supported by AI technology.
The firm manages financial transactions requiring high accuracy and speed standards.

Enterprises should build model-agnostic architectures to swap foundation models without disruption.
Migrating data infrastructure is a multi-year program compared to simple config changes.

Product: Payments platform providing payment processing, checkout solutions, fraud management, and merchant services including UPI, cards, and wallets
Customers: Merchants and e-commerce businesses ranging from SMBs to enterprise seeking payment infrastructure and services
How it makes money: Payment processing with transaction fees, subscription services for merchant tools, and technology licensing
What sets it apart: Pan-India merchant network, AI-powered fraud protection, accessibility-first checkout, and integration with emerging channels like ChatGPT