Generative artificial intelligence is reshaping financial services, specifically in lending. It affects credit risk assessment and decision-making by integrating real-time data for modern underwriting processes. Traditional lending practices often leave small businesses underfunded, despite their significant contribution to the economy. AI predictive models are becoming essential in addressing these gaps, facilitating lending opportunities that conventional credit models fail to capture. This evolution raises questions about the future role of human lending officers versus algorithmic systems, shaping the relationship between technology and trust in financial services.
"small business makes up 44% of the US economy...but only about two and a half percent of loans on bank balance sheets are small business loans."
"banks have historically been a traditional underwriting model...that has really only viewed small businesses either on their consumer history, first with a thin or flat file."
#ai-in-lending #credit-risk #small-business-loans #financial-services-transformation #underwriting-innovations
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