AI Tech Applied to Instant Loan Issuing at SCB
Over the months, the increasing reliance on AI technologies has given way to multiple pilot experiments by financial companies. Next in line, Thailand-based institution SCB claims they are using Machine Learning techniques to implement a new online credit application tool.
Their new mobile app, SCB EASY Digital Lending, brings together several offers: personal loans, car loans, mortgages, credit services for SMEs, and credit cards. This tool is intended for their customers, allowing them to easily apply for a credit in less than three minutes (vs 30 minutes before that), through their m-banking portal.
Interested customers need to access the “Loan & Credit Card” tab in-app, and choose the terms for their loan. For each customer, the app displays the maximum amount that could be lent. The underlying algorithm then assesses their project’s viability in real time. The process does not require that specific forms be filled in since the tool analyses banking-related data directly. If approval is granted, the customer proceeds to a strong authentication step (6-digit PIN or biometric factor), and the agreed upon amount can be sent to his account balance instantly.
The bank relies on dedicated Data Analytics tools to propose tailored loan products to their customers. Machine Learning techniques will also apply to push customised credit offers without customers even enquiring. SCB would for instance consider pushing credit solutions to customers whose account is about to go overdraft while a recurring charge is pending.
Comments – A part for new technologies in transforming the credit industry
This new service reflects two concomitant factors. First, progress made in data analytics, Machine Learning, and AI technologies has brought along new opportunities. Second, smartphones are everywhere now, and have played their part in drastically changing the way customers relate to financial services. This is obvious in Thailand as the number of mobile banking transactions grew significantly.
SCB stands out through implementing predictive analytics tools and actually analysing their customers' accounts to streamline their lending process. They expect to increase lending by more than 10 billion baht (250 million euros) with this new offer (70% would consist in revolving credit, personal loans or credit cards; 30% in car and mortgage loans). They also want to attract more users for their mobile app, aiming for more than 10 million people by the end of 2018. To achieve these goals, a communication campaign featuring preferential terms has been kicked off.