All Insights|Future Nexus
fintechaiJanuary 2, 2019

The Black Box Issue with AI is Starting to be Solved

One of the biggest impediments to using AI to lend is that credit decisions are made in a black box and they cannot be explained; a number of fintech firms and big banks are helping to change this and offer explainability so regulators can get comfortable with AI driven underwriting; regulators want to understand if someone is denied credit then what is the reason for denial; the fintech firms argue that a lot of the current metrics like income and FICO score are already skewed towards to most well off people; ZestFinance, Upstart and Underwrite.ai use a variety of different data points in their decision engines and all offer explainability as to why someone is denied credit; AI has started to make a turn towards wide scale adoption but it still has a ways to go and regulators need to ensure they keep up with this change. Source.