Standard Chartered, Experian to launch AI-powered credit screening tool in developing markets

October 16, 2020.

has partnered with to launch technology that uses artificial intelligence to gauge loan risks for borrowers in six emerging markets, potentially boosting lending to underserved groups.

The Irish credit agency said Standard Chartered would use its AI-enhanced risk assessment tool to ramp up lending in places where consumer credit has been hard to come by. The companies’ agreement could help London-based Standard Chartered continue its push into developing markets in Asia, Africa and the Middle East.

According to Experian, the partnership deal will help build on the U.K. lender’s digital financing platform for small and medium businesses in India. Launched in 2019, the tool aimed to give the country’s significantly “underbanked” population access to business loans, supply chain financing, logistics, commercial insurance and other services.

India’s small and medium companies contribute approximately 30% of GDP and 45% of the country’s exports, according to the Economic Times.

Called the PowerCurve Strategy Manager, Experian’s analytics tool uses machine learning software to help financial institutions process large volumes of traditional and alternative data on creditworthiness. Lenders can then more quickly and accurately gauge credit risks, Experian said, leading to higher loan approval rates and lower delinquencies.

Sources of alternative credit data include rental and utility payments, asset ownership information and certain public records which aren’t typically considered in a conventional loan application.

“This partnership helps the bank manage risk more effectively with a more robust data-driven credit decisioning which in turn enables more clients to gain access to financial services,” said Vishu Ramachandran, group head of retail banking at Standard Chartered.

The companies’ agreement could further expand Standard Chartered’s lending business in its three major geographic regions. Through the first half of 2020, the bank’s north Asia, south Asia and Africa and Middle East operations together accounted for nearly 86% of underlying pre-tax profit.

“Partnerships are central to our digital banking strategy,” said Aalishaan Zaidi, global head of client experience, channels and digital banking at Standard Chartered.