Peak Fintech Group (CNSX: PKK) Leverages AI to Change Future of Commercial Lending
- Artificial Intelligence
- 12.10.2020 05:39 pm
From self-driving cars to quantum computing, Artificial Intelligence (AI), or the advanced process for a machine to make decisions based on logic, has already made a significant global impact.
Today, AI is growing in reputation as an emerging technology and transforming the way businesses operate in a range of industries. The technology is strengthening operations and improving the customer service experience. AI is also making an impact on FinTech by increasing the accuracy of the payment and lending process.
In the commercial lending industry meanwhile, Artificial Intelligence is streamlining the borrowing process and giving the borrower a decision within minutes without having to interact with a human at any stage.
Historically, tech investment in commercial lending has been focused on retail and small business loans, where the process is fully-automated. Now, through in-depth credit analysis, machine learning is helping global banks provide businesses with the type of deals that’s been typically reserved for large organizations.
AI technology enables banks to engage with borrowers in a vastly different way. With AI, banks and commercial lending institutions have better insight to borrowers’ businesses; and the technology enables managers to have more relevant and thoughtful conversations with the business owner, thus building more meaningful relationships with them.
Instead of wasting time on mundane tasks, bankers can focus on structuring a loan for their borrowers’ needs in the time frame they need it. In the UK, for instance, a bank used an AI platform and since September 2015, has lent over $5 billion dollars without any credit losses.
In China, unlike Great Britain, the commercial lending space has faced many roadblocks. With over 100 million small and micro businesses who rely on credit for their regular operations, it’s not always easy to get the funding they need.
These small businesses oftentimes blindly knock on bank doors, which can lead to rejection and frustration. Additionally, there are over 10,000 banks and lending institutions in China, each with unique lending criteria; and commercial lending can be compared to a blindfolded matching game between lenders and borrowers.
Since the future of China’s commercial lending industry relies on technology, there must be a way to bridge the two components.
The Quebec-based company uses technology, analytics and Artificial Intelligence to create an ecosystem of lenders, borrowers and other participants in China’s commercial lending space where lending operations are conducted rapidly, safely, efficiently and with the utmost transparency.
For example, Peak Fintech Group’s Cubeler Lending Hub, an analytics and AI software platform, brings together SMEs, lenders, brokers, data providers and automated risk management capabilities for the purpose of making commercial lending more efficient and, as a result, more profitable.
The Cubeler Lending Hub provides small to medium enterprises value in that it’s free to sign up, and there’s no need to shop around because it brings lenders right to the business. Further, the ecosystem solution significantly increases the chances of getting funded, and there are several options available from a variety of lenders.
For the banks and lending institutions, the Cubeler Lending Hub minimizes lending risk, saves time and money and brings ideal clients to their doors.
“For financial institutions, finding the right small and micro businesses to lend to isn't always easy. Our technology simplifies everything. It brings all of those small businesses and lenders together into a hub and automatically the right businesses get matched with the right lenders,” explains Peak Fintech Group's CEO, Johnson Joseph.
Johnson Joseph goes on to say, “We try to offer a full scale solution to financial institutions in China. Some of these financial institutions may not want to go through the trouble of trying to qualify the businesses for loans so we have different subsidiaries who do different things.”
Peak Fintech Group has a subsidiary called Asia Synergy Credit Solutions (ASCS) which is essentially an outsourcing service for larger banks who don't want to deal directly with small and micro businesses. ASCS will find the client, it will qualify them and then it will handle everything related to the loan including recording collateral, servicing the loan, and making small fee charges to the bank.
If one thing is certain, it’s that Artificial Intelligence and machine learning are making a difference not only in the commercial lending space, but in the FinTech industry as a whole.