Case Study: Using Artificial Intelligence to Improve Underwriting - by's Marc Stein

By's Marc Stein

Lenders of all stripes have begun using artificial intelligence (AI) to more efficiently underwrite and at LendIt USA 2017 we looked at how AI can be used to improve the underwriting process; understanding the history of assessing risk in consumer lending helps to set the basis for the limitations of traditional credit scoring for today’s borrower; the current models used for scores like FICO are great if you are a prime borrower, but a majority of the US population falls outside that bucket; using machine learning algorithms based on application attributes and a credit file can help to build a more suitable risk profile of the borrower that falls outside the prime category; Marc Stein of goes through specific cases where his company was able to bring down default rates significantly and provides a practical look into how AI can help a lender's underwriting capabilities.