MAS announced that the first phase of the Veritas initiative will commence with the development of fairness metrics in credit risk scoring and customer marketing. Veritas Initiative is a framework that will enable financial institutions to evaluate their AIDA-driven [Artificial Intelligence and Data Analytics] solutions against the principles of fairness, ethics, accountability, and transparency; the aim of this evaluation is to strengthen internal governance around the application of artificial intelligence (AI) and the management and use of data. The Veritas consortium will publish a white paper documenting the metrics and release an open-source code to enable financial institutions to adopt the fairness metrics in these two areas by the end of this year.
Two core teams within the Veritas consortium will be taking on the development of the fairness metrics. UOB and Element AI will develop the metrics on credit risk scoring. Credit risk scoring to assess the credit worthiness of borrowers is a critical function of the financial services industry and impacts most customers of financial institutions. Given the large amount of customer data to analyze, financial institutions are increasingly employing artificial intelligence tools for this purpose. It is crucial that decisions driven by artificial intelligence do not systematically disadvantage any individuals or groups when determining the credit risk scoring.
HSBC, IAG Firemark Labs, and Gradient Institute will develop the metrics on customer marketing. Customer marketing is another area with significant potential for artificial intelligence adoption. As marketing processes become increasingly digitalized and automated, there is increasing scope to use artificial intelligence tools to analyze customer data and match products or services to customers. Hence, it is important that such artificial intelligence solutions recommend the right product to the right customer at the right time.
Since the announcement of this project in November 2019, eight new members have joined the Veritas consortium, which brings the current membership to 25 members. MAS has published a list of members of the Veritas consortium.
Keywords: Asia Pacific, Singapore, Banking, Fintech, Veritas Consortium, Credit Risk, Data Analytics, APIX Platform, Artificial Intelligence Metrics, Credit Scoring, MAS
Previous ArticleIOSCO Consults on Outsourcing Principles for Operational Resilience
HKMA announced that enhancements will be made to the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme (SFGS) and the application period will be extended to December 31, 2021.
EBA launched consultations on the regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in prudential supervision of investment firms.
BoE has set out a three-phased plan to transform data collection from the UK financial sector over the next decade.
BIS recently made a couple of announcements with respect to the planned and ongoing work in the area of financial technology.
ESRB updated the list of national macro-prudential measures applied by each member state in the European Economic Area.
BoE has set out results of a survey on the impact of COVID-19 events on the use of machine learning and data science.
In response to a request from the European Council and Parliament, ECB published an opinion on the proposed regulation on markets in crypto-assets.
APRA announced the updated aggregate amounts for the 2021 Committed Liquidity Facility (CLF) established between the Reserve Bank of Australia (RBA) and certain locally incorporated authorized deposit-taking institutions that are subject to the Liquidity Coverage Ratio (LCR).
ECB published supervisory Memorandums of Understanding (MoUs) with UK as well as other European and non-European authorities.
EIOPA identified business model sustainability and adequate product design as the two EU-wide strategic supervisory priorities.