Machine learning offers banks and credit unions an opportunity to ramp up risk management without becoming dependent on obscure, complex algorithms.
Artificial intelligence is built on algorithmic processes that use complex calculations to identify and act on trends in data. The potential for biases and similar errors in artificial intelligence make it vital that firms establish processes to manage potential issues with the technology.
Machine learning, on the other hand, builds on AI by becoming less dependent on algorithms. A machine learning platform uses large quantities of data to learn how different types of information lead to various results, making the technology adaptable.
Firms that want to maximize the value of machine learning can use it alongside credit scorecard technologies to create sophisticated credit risk models.
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