Loan underwriting, even in the 21st century, is hardly a high-tech process. While underwriters might quickly Google a loan applicant or check out their Facebook Inc (NASDAQ: FB) or Twitter Inc (NYSE: TWTR) feeds for insight into their financial life, it often doesn't get much more tech-savvy than that. There's generally a lot of manual work involved, in which an underwriter pores over public documents to provide the traditional service. However, fintech startups are working to upend the traditional underwriting process with an injection of machine learning technology. Datanomers, a New Jersey-based fintech startup, has developed a "financial risk profiler" that trawls the web for unstructured non-financial data on loan applicants, indexes the information and generates a report for the underwriter.
Artificial Intelligence (AI) is having a seismic impact across the banking industry. Its utilisation is broad and diverse, ranging in application from chatbots and virtual assistants to profiling customers, streamlining processes, identifying trends and patterns in customer behaviour and risk management. If you're new to the world of AI, getting to grips with the terminology can seem daunting, but getting started in AI is way more straightforward than you might think – and the rewards for taking action early can be vast in terms of keeping your customers happy, providing a unique competitive edge for your business and reaping the associated commercial rewards. According to industry analysts, AI has the potential to drive one of the greatest and most profound technological revolutions in modern history. Artificial Intelligence, or AI as its more commonly referred, relates to the design and creation of systems, machines or applications that possess the ability to undertake complex tasks traditionally performed by humans.
There is a fresh wave of disruption post COVID-19. Banks and financial institutions are adapting digital transformation at a blazing pace, this is a good and a progressive sign for us as this opens doors to the much awaited advancements in the financial sector. Lets just say – now the digital revolution has truly begun. The COVID-19 crisis has triggered customers to adopt digital interaction across segments. Nowadays branch loving customers are also using digital platforms to interact with their banks or NBFCs (Non-Banking Financial Companies) – this routine may become a trend in the future.
Mike Tyson famously said that "Everyone has a plan until they get punched in the mouth". Every company had a strategic plan coming into 2020. Then, Covid-19 walked into the ring. Insurance has been hit hard by Covid-19 and economic hardship. With many insurers focused on cash conservation, leading insurers can emerge from the crisis even stronger if they make smart investments in AI. Insurers' massive customer datasets and their famously manual processes create some'quick win' AI opportunities.