Published: July 17, 2023 / Updated undefined ago
How technology and innovation are transforming financial services
Generative AI and automation are driving a new wave of innovation. Experian’s Alex Lintner explains why that’s a good thing for the future of financial services.
Innovation is defined as a new idea, or ideas, method or device which can generate value. The application of fresh ideas results in the development of new solutions or the improvement of existing goods and services. For businesses, finding this value can mean the difference between success and failure, paving the way to growth.
In a fast-changing economy the ability to innovate is crucial. A good example can be found in the evolution of the financial services sector. American rocket scientist Simon Ramo’s notion of a “cashless society,” driven by information and technology, paved the way for the modern financial system we have today. Now, with the emergence of exciting new capabilities such as generative AI and machine learning technologies, there has been an explosion of creative thinking as the financial services industry anticipates a new era of disruption and improvements.
Generative AI tools will help financial organizations to improve and personalize their interactions with customers, improve risk management and compliance, enhance fraud detection and prevention, and deliver more data-led reporting and forecasting.
In the past, data analytics and software company Experian has been able to help transform the global credit economy through digitization and sophisticated analytics. Today, the company enables automated lending decisions in microseconds, which helps grease the wheels of the global economy. Innovation with purpose runs through the core of the business and they are focused on driving positive outcomes for consumers and businesses in their markets.
“As individuals and businesses look at the best ways to navigate economic turbulence, we need to use technology to help them chart a course towards growth,” says Alex Lintner, CEO of Experian Software Solutions.
Lintner’s staff comprises data analysts, scientists and engineers with a broad set of expertise in advanced analytics, artificial intelligence and machine learning, as well as other advanced statistical methods. They are tasked with finding solutions to improve the financial system, all through the application of the latest tech.
“In the financial services industry there are two major tech trends that are evolving the way we do business, and they are related,” Lintner says. “One is the use of artificial intelligence—specifically, generative AI. The second is automation at scale.”
“AI will allow machines to recognize speech, to learn and to make decisions much like humans do. Automation at scale will allow us to automate mundane tasks and labor-intensive processes, which will reduce human error. So, both are very good for us as a society, and for businesses, because they allow humans to focus on creative decision making, problem solving, and more effective collaboration.
“When we apply this to the credit ecosystem, advances in analytics and modelling are making credit risk decisioning more efficient and precise. And while businesses may face challenges in developing and deploying new credit risk models, machine learning is paving the way for shorter design cycles and greater performance lifts.”
While machine learning approaches to modelling aren’t new, advances in computer science and computing power are unlocking new possibilities. Machine learning models can now quickly incorporate your internal data, alternative data, credit bureau data, credit attributes and other scores to give a more accurate view of a consumer’s creditworthiness, helping financial service providers to improve outcomes for borrowers and increase financial inclusion, while reducing overall costs. And maybe most importantly, it enables lenders to introduce continuous monitoring, so that models built leveraging generative AI are explainable without skyrocketing human labor costs.
“Our culture of innovation and commitment to utilizing the latest technology has allowed us to find and provide cutting-edge solutions for high-growth markets, solving critical needs across industries,” Lintner says. “Whether in finance, healthcare, advertising or automotive, we are always pushing the boundaries of what's possible. Every day, we are exploring new ways of using technology to expand access to credit, helping businesses and consumers to take control of their finances and grow.”
To find out more about the Experian Exchange series, go to Experian.com/exchange.