target audience: TECH SUPPLIER Publication date: Jun 2024 - Document type: Market Perspective - Doc Document number: # AP50982024
Charting New Value for Digital Lending with AI
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Abstract
This IDC Market Perspective analyzes the impact of AI on digital lending in Asia/Pacific, revealing a transition toward data-centric approaches across the processes and functions in the entire digital lending value chain. A significant emphasis is placed on using alternative data for credit scoring, enabling banks to cater to underserved segments, such as small and medium-sized enterprises (SMEs). Real-world examples, including an automated credit underwriting system and the strategic use of alternative data banks, advise banks to strengthen digital infrastructure and embrace AI for long-term gains in digital lending.
"These have been a very impressive set of capabilities in digital lending, thanks to the continuous improvement in technology investments particularly around AI. Among all the improvements, the development of speed to decision making is huge. Banks in the region should gear toward a more data-driven approach, automating the credit underwriting to achieve faster loan processing and greater customer satisfaction," says Xiao Liu, research manager, IDC Financial Insights Asia/Pacific.