Risk Management

FinTech

Credit risk is the economic loss that emanates from a counterparty’s failure to fulfill its contractual obligations, or from the increased risk of default during the term of the transaction. The increased complexity of assessing credit risk has opened the door to deep learning in finance. This is evident in the growing credit default swap market where there are many uncertain elements involving determining both the likelihood of an event of credit default and estimating the cost in case a default takes place.

Benefits for the company

Risk Modeling a high priority for the financial industry. It helps them to formulate new strategies for assessing their performance.
Unlike the traditional methods which are usually limited to essential information such as credit score, ML can analyze significant volumes of personal information to reduce their risk.

Feasability

High

Type of expertise/ AI domain

Machine Learning and Statistics

Internal data required

Customer Behavioural Data, Historical Transaction Data, Asset Valuation Data

External data possible

Social Media Data/Sentiment Analysis Data

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