SBI Bank

As mortgage loans are long-term and typically involve a large sum of money, losses from any default are substantial. This results in a longer assessment and approval for loan applications, a process that could take days.

With a shrinking population in Japan, the number of mortgage applications are also decreasing, resulting in a more competitive landscape between financial institutions.

Unlike regular personal loans, risks involving mortgages are harder to compute due to the limited data present. Therefore, financial institutions require a robust system to accurately and efficiently screen loans while reducing any default risk.

Together with Hitachi, SBI Sumishin Net Bank plans to use AI to provide loan screening services to a spectrum of lending mortgage and card loan institutions.

Through Hitachi’s AT/PRC technology coupled with the bank’s expertise and data, the joint venture was able to overcome issues related to the low number of occurrences for rare events while ensuring deep learning is done sustainably.

Because of this, the investigation service can accurately predict which financing requests have lower risks and can therefore deliver reduced credit costs for the bank. This helps customers better identify prospects who are a better fit. This helps customers to promote financial inclusivity across communities.

The first phase of the AI investigation services was successfully launched for housing loans. Using big data and the AT/PRC technology, the bank was able to identify and better cater to customers.

The technology is now being further enhanced to apply to a more diverse range of risk management issues.

This includes investigations into suspicious or unfair transactions in the stock market, evaluation of new customers in KYC procedures, and credit-worthiness investigations for general loans.

Through this partnership, SBI Sumishin Net Bank will be able to extend greater financial aid swiftly across Japan to help the society and the community at large.