Artificial intelligence and bank credit analysis: A review

Hicham Sadok, Fadi Sakka and Mohammed El Hadi El Maknouzi

Cogent Economics & Finance, 2022, vol. 10, issue 1, 2023262

Abstract: This article teases out the ramifications of artificial intelligence (AI) use in the credit analysis process by banks and other financing institutions. The unique features of AI models, coupled with the expansion of computing power, make new sources of information (big data) available for creditworthiness assessments. Combined, the use of AI and big data can capture weak signals, whether in the form of interactions or non-linearities between explanatory variables that appear to yield prediction improvements over conventional measures of creditworthiness. At the macroeconomic level, this translates into positive estimates for economic growth. On a micro scale, instead, the use of AI in credit analysis improves financial inclusion and access to credit for traditionally underserved borrowers. However, AI-based credit analysis processes raise enduring concerns due to potential biases and ethical, legal, and regulatory problems. These limits call for the establishment of a new generation of financial regulation introducing the certification of AI algorithms and of data used by banks.

Date: 2022
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1080/23322039.2021.2023262 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:oaefxx:v:10:y:2022:i:1:p:2023262

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/OAEF20

DOI: 10.1080/23322039.2021.2023262

Access Statistics for this article

Cogent Economics & Finance is currently edited by Steve Cook, Caroline Elliott, David McMillan, Duncan Watson and Xibin Zhang

More articles in Cogent Economics & Finance from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().