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
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