Credit scoring disruption

Challenge

Young people’s consumption patterns have changed the lending business. This generation can no longer be marketed to by traditional methods.
They are ultra connected, “mobile first”, want to enjoy more personalized experiences, and have different expectations for speed of service. A disruptive approach becomes required to grow.
The goal of this project was to improve the credit granting system to allow a more favorable response to young people’s personal loan applications.
This system had to allow a faster response without neglecting financial risks. The company wanted to disrupt the current credit scoring system.

Solution

Octopeek proposed a solution with four main criteria for success:

• • • • Increasing positive responses to loan request with strong risk underwriting
      • Real-time response
      • Credit offer sensitive to usage
      • Reinforce customer loyalty

Our AI model is based on an enriched, GDPR-compliant dataset: the resulting dataset was comprised of 10% internal customer data and 90% new data. More than 1000 new elements were added. Open Data and social networking data were used to bring these new features. Data is refreshed  more frequently, 3 months vs. 1 year.  The model was built to work with structured and unstructured data. The Octopeek predictive model superseded the old score card making the traditional model obsolete. The benefits are twofold: On the client’s side:

• • • • The almost real-time credit answer
      • An increase in the allocation of loans: 15 to 40% additional approvals

On the Bank side:

• • • • Improved business performance: more customers, better customer loyalty, therefore lower churn
      • A rise in loan officer productivity
      • 15 to 25% lower losses due to improved credit underwriting

Why Octopeek?

The Financial industry needs to move from ad-hoc experimentation with AI to enable everybody within the organization to use it to improve both operational efficiency and deliver business value.
Octopeek aims to be the platform that democratizes AI in the enterprise: it makes possible a dynamic creation and provisioning of full-fledged enterprise AI applications, customizable by business analysts.