Have you borrowed money recently? Are you a business interested in lending money to other people? Then you'll want to think about how the lending industry is taking advantage of artificial intelligence. It can improve the process for customers.
With digital banks challenging traditional high street banks, crypto-currencies in the ascendency and ever globalized economy, the banking system is changing.
Here's everything you need to know about the lending industry and AI.
Filter out Ineligible Loaners
Artificial intelligence can filter out ineligible loaners very easily. No longer do borrowers have to apply for a loan. Nor do they have to fill in a lengthy application form. This could contain details about their credit score, home address, and other financial information.
Instead, artificial intelligence can look at a person's digital record and the publicly available material. The computer can then decide if they are eligible for the loan product, no application necessary.
This can be achieved en-mass so that a company wanting to bring in customers for a loan can target only those who are eligible. There is no need to waste any time on marketing campaigns to those who wouldn't be approved anyway.
This is great for targeted online marketing campaigns on platforms such as Facebook and YouTube where you can target specific groups of people with tailored adverts.
By allocating the decision about whether to lend or not over to artificial intelligence you can reduce the risk that anyone you lend to won't pay you back.
Lending institutions can use this new technology to use psychological tools as well as financial ones. They can weed out those who might have personality traits that suggest they might not pay back the loan.
With more accurate information on lenders and reduced risk, lending institutions can increase the volume of lending.
This means that businesses can lend money to more people. Companies can rely more heavily on the fact that lenders will pay back their loans, and on time.
A higher volume of lending and access to an instant loan is better for society. It means that more people have access to credit to build businesses which in turn generates more money for jobs.
Artificial Intelligence Is the Future Of the Lending Industry
The world is changing fast. Like all other industries, new technology is transforming finance and uprooting old processes.
Artificial intelligence is now making it easier to lend to people. Lenders can find the people eligible for loans. They can just target them without having to waste time marketing to people who would apply, only to be rejected.
This means that instant loans can become more widely available to those who want them and are eligible because lenders can reduce the risks associated with lending to people with poor credit.
If you are interested in reading more about artificial intelligence and how it relates to the lending industry then be sure to check out the rest of our site.