The Digital Credit Revolution: Technological Innovation in Lending

Frank J. Fabozzi

Chapter 6 in Credit Market Innovations:How Institutions, Technology, and Regulation Are Reshaping Global Lending, 2026, pp 175-201 from World Scientific Publishing Co. Pte. Ltd.

Abstract: The following sections are included:Introduction: How Technology Is Reshaping Credit MarketsBig Data in Credit Decision-MakingArtificial Intelligence in Credit MarketsMachine Learning Applications in CreditDynamic credit risk modelingChallenges in ML implementationBlockchain Technology and DeFi in Credit MarketsIntroduction to blockchain in financeBlockchain’s role in decentralized finance and peer-to-peer lendingDeFi InnovationsBlockchain technology as a tool for expanding credit accessCase StudiesBig data in credit risk assessment: Zest AIAI-driven lending platforms: UpstartBlockchain-based credit solutions: MakerDAOCelo: Mobile-first blockchain for inclusive financeEverex: Cross-border microcredit for migrant workersML for fraud detection: PayPalBlockchain for cross-border credit transactions: RippleBlockchain for carbon credit markets: The Northern Trust carbon ecosystemKey Insights and Challenges in Technology-Driven Credit MarketsSummary

Keywords: Credit; Innovation; Lending; Technology; Regulation; Risk; Institutions; Markets; Credit Risk; Securitization; Credit Scoring; Fintech; Private Credit; Structured Finance; Credit Instruments; Blockchain; Artificial Intelligence; Machine Learning; Stress Testing; Risk Models; Debt Markets; Digital Lending; Central Banks; Financial Regulation; Credit Cycles; Institutional Investors; Capital Markets; Credit Products; Legal Innovation; Market Structure; ESG; Macroprudential; Asset-backed Securities; CLOs; Credit Analytics; Big Data; Data Privacy; Financial Technology; Underwriting; Alternative Data; Credit Access; Risk Management; Credit Derivatives; Distributed Ledger; Tokenization; DeFi; Credit Enhancement; Yield Curves; Credit Spreads; Default Risk; Credit Innovation; Loan Syndication; Legal Frameworks; Compliance; Basel III; Systemic Risk; Lending Platforms; SME Lending; Consumer Credit; Mortgage-backed Securities; Securitized Products; Credit Performance; Credit Transformation; Credit Monitoring; Algorithmic Lending; Digital Identity; Financial Inclusion; Credit Exposure; Peer-to-peer Lending; Nonbank Lenders; Financial Infrastructure; Payment Systems; Real-time Data; Financial Resilience; Geopolitical Risk; Regulatory Arbitrage; Collateral; Capital Requirements; Loan Origination; Portfolio Risk; Operational Risk; Credit Risk Transfer; Data Analytics; Transparency; Investor Protection; Risk-adjusted Returns; Rating Agencies; Credit Default Swaps; Legal Risk; Structured Credit; Lending Innovation; Compliance Tech; Stress Scenarios; AI Credit Modeling; Privacy Laws; Quant Credit Models; Credit Policy; Regulatory Innovation; Market Transparency; Cyber Risk; Default Models (search for similar items in EconPapers)
JEL-codes: D82 G21 G28 G32 O33 (search for similar items in EconPapers)
Date: 2026
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