Through modernizing business-lending procedures, banks can harness new SME opportunities and achieve forecasted growth gains.
The International Financial Reporting Standard (IFRS) 9 models need to evolve quickly. There is no doubt the pandemic’s impact on the models and framework generated stressors in unforeseen ways, creating significant challenges to banks’ loan-loss provisioning levels.
By enhancing MRM framework capabilities—organizations are upgrading validation resources. Risk culture, standards, and procedures rank high on the overall MRM 2.0 agenda.
Banks need to implement more automated credit-decisioning models that can tap new data sources, understand customer behaviors more precisely, open new segments, and react faster to changes in the business environment. These best practices can help any bank elevate its credit model.
Organizations need a better way to maximize benefits of new technologies while minimizing risks, as adoption of automation and artificial intelligence grows.
There are many applications that can help public agencies improve outcomes and streamline processes to make the best use of limited resources. New technologies, including AI and ML do come with challenges, and understanding these risks, including bias, is crucial for organizations to increase positive outcomes.