Can the supervisory institutions of the banking system allow the generative artificial intelligence used in the lending business to make a decision on whether or not to extend credit?
Can the banking system supervisory institutions allow changes in banking procedures in which generative artificial intelligence in the credit departments of commercial banks will not only carry out the entire process of analyzing the creditworthiness of a potential borrower but also make the decision on whether or not to extend credit?
Generative artificial intelligence finds application in various spheres of commercial banking, including banking offered to customers remotely through online and mobile banking. In addition to improving remote channels of marketing communication and remote access of customers to their bank accounts, tools based on generative AI are being developed, used to increase the scale of efficiency, automation, intelligent processing of large sets of data and information on various processes carried out inside the bank. Increasingly, generative AI technologies learned in deep learning processes and the application of artificial neural network technologies to perform complex, multi-faceted, multi-criteria data processing on Big Data Analytics platforms, including data and information from the bank's environment, online databases, online information portals and internal information systems operating within the bank. Increasingly, generative AI technologies are being used to automate analytical processes carried out as part of the lending business, including, first and foremost, the automation of creditworthiness analysis processes, processes carried out on computerized Big Data Analytics and/or Business Intelligence platforms, in which multicriteria, intelligent processing is carried out on increasingly large sets of data and information on potential borrowers and their market, competitive, industry, business and macroeconomic environment, etc. However, still the banking system supervisory institutions do not allow changes in banking procedures in which generative artificial intelligence in the credit departments of commercial banks will not only carry out the entire process of analyzing the creditworthiness of a potential borrower but will also make a decision on whether to grant a loan. Banking supervisory institutions still do not allow this kind of solution or precisely it is not defined in the legal norms defining the functioning of commercial banking. This raises the question of whether the technological advances taking place and the growing scale of applications of generative artificial intelligence technology in banking will not force changes in this area of banking as well. Perhaps, the growing scale of implementation of generative AI into various spheres of banking will contribute to the continuation of the processes of automation of lending activities which may result in the future in generative artificial intelligence making a decision on whether or not to extend credit.
In view of the above, I address the following question to the esteemed community of scientists and researchers:
Can the supervisory institutions of the banking system authorize changes in banking procedures in which generative artificial intelligence in the credit departments of commercial banks will not only carry out the entire process of analyzing the creditworthiness of a potential borrower but will also make a decision on whether or not to grant a loan?
Can the supervisory institutions of the banking system allow the generative artificial intelligence used in credit activities to make the decision on whether or not to extend credit?
Will the generative artificial intelligence applied to a commercial bank soon make the decision on whether to grant credit?
And what is your opinion about it?
What do you think about this topic?
Please answer,
I invite everyone to join the discussion,
Thank you very much,
Best regards,
Dariusz Prokopowicz
The above text is entirely my own work written by me on the basis of my research.
In writing this text I did not use other sources or automatic text generation systems.
Copyright by Dariusz Prokopowicz
The integration of generative artificial intelligence in banking, particularly in credit analysis, is a complex matter involving regulatory considerations. Banking supervisory institutions may need to carefully assess the risks and ethical implications before allowing AI systems to make credit decisions. While AI can enhance efficiency and data processing, the potential for bias, accountability issues, and the need for transparency must be addressed. It's an ongoing dialogue between technological advancements and regulatory frameworks to strike a balance that ensures responsible and fair use of AI in the financial sector.
- Badges
- Science topic
- Similar topics
- Filing