Mitigating Risk: Strengthening Data-Driven Lending with AA

27 Dec 2024

The winning presentation in the 3I Use Case Competition under the Risk Management category showcased an innovative approach to lending. Team Helpage, in partnership with FinVu AA and Finagg TSP, unveiled a state-of-the-art loan monitoring system that integrates the power of Account Aggregators (AAs) with advanced AI tools.

This system leverages real-time financial data to monitor borrower health, offering early warning signals that improve credit risk management and portfolio quality. The platform ensures a holistic view of financial health by consolidating data from sources like bank accounts and GST via AA and other sources like ITRs and credit bureaus. Its AI-driven algorithms identify trends, flag inconsistencies, and recommend actions—whether to adjust credit limits or proactively address potential risks.

The team emphasised the transformative role of AAs in creating a sustainable lending ecosystem. Quarterly assessments powered by continuous AA consent allow lenders to recalibrate limits dynamically, aligning with the borrower’s evolving financial status. Back-testing revealed that implementing this system could have reduced NPAs by 12-15% on an existing portfolio.

This solution represents a significant leap in efficiency and reliability for MSME and small-ticket lending, which often struggles with scalable monitoring. The fusion of AAs and AI ensures compliance and accuracy and fosters trust, transparency, and better financial outcomes for all stakeholders.

Watch the session recording here.