From Hype to Impact: How AI is Transforming Credit

Advances in artificial intelligence have generated a high level of excitement and marketing spending as financial organizations seek to rebrand their technologies with “AI” and develop new credit decisioning and issuance solutions that leverage this developing power. Generative AI is one of the latest developments in this technology and is changing the way financial institutions analyze data and is streamlining customer service operations through chatbots and virtual assistants. It also comes with considerable risks that must be mitigated to maintain regulatory compliance and protect FIs from reputational harm. 

This Javelin Strategy & Research report looks at the state of play in banking across various forms of AI and examines the imperfections inherent in the science and what financial institutions must do to protect themselves and their customers as they harness this powerful technology.

Key questions discussed in this Credit report: 

• How is generative AI changing the game in credit decisioning and issuance?
• What are the risk factors associated with increasing the deployment of AI solutions in financial services?
• What are the regulatory hurdles associated with AI usage, particularly generative AI? 

Companies Mentioned: 

Affirm, Bank of America, Board of Governors of the Federal Reserve, Capital One, Chase, Citi, Consumer Financial Protection Bureau (CFPB), FICO, Fiserv, Goldman Sachs, Independent Community Bankers Association (ICBA), National Credit Union Administration (NCUA), U.S. Bank, VantageScore