The digitally savvy lender MyBucks, which has lent money through a smartphone app and chatbots on WhatsApp and Facebook Messenger, could be a good role model for U.S. banks thinking of using AI in credit decisions.
BankMobile, the digital-only subsidiary of Customers Bank in Wyomissing, Pa., is planning to use software by Upstart to offer its first credit product to graduates and other young consumers with little to no credit history.
The risk to Canada's financial system from tapped-out borrowers is merely shifting — this time to a market where there's no oversight from the country's national bank regulator and new stress-test rules don't apply.
The promise of fintech is that it might offer underbanked consumers access to financial products. But some are worried that relying on algorithms to make credit decisions could open up problems of its own.
Dan O'Malley, who until very recently ran the fintech incubator at Eastern Bank (and before that was at Capital One), now has a startup called Numerated Growth Technologies and software that he says can process loans in five minutes.