Although there’s plenty of discussion being generated about the transformative power of AI in asset finance, “very few people are doing as much as they are talking about,” according to Andrew Flegg chief technology officer at Alfa, a provider of consultancy services to the global asset finance industry.
Flegg made his comments in a recent podcast conversation with Simon Goldie, head of asset finance for the Finance and Leasing Association.
Flegg said a reluctance to implement artificial intelligence (AI) and machine learning (ML) by businesses could be explained by red tape and because of data concerns: “There are regulatory impacts if you are dealing with consumers but there are also holes in the data and existing biases which can be replicated,” he added.
Speaking on the use of AI in the asset finance industry, Flegg said there are four classic examples of where AI and machine learning is found in asset finance.
“Credit ‘decisioning’, predictive delinquency, fraud detection and predicting residual values. All of which take large sets of data of the assets that a lessor will have and tries to predict and model future behaviour based on that data,” Flegg said.
Goldie asked about how companies can go about integrating business technology and developing an IA vision for their businesses.
Flegg said: “I think having an AI strategy is probably the wrong way of looking at it, it needs to be looked at as either part of a digitalisation or technology strategy, more importantly, a business strategy about the experience you want to give to your customers or internal users.”