Calling artificial intelligence (AI) a “powerful technology,” the regulator of national banks said Tuesday it can be used to help banks make more informed decisions – but only if it is built and used responsibly, such as in supporting financial inclusion.
For example, said Acting Comptroller of the Currency Rodney Hood, AI models may intuit relationships among variables that humans cannot, “thereby presenting the risk of unintentionally perpetuating historical patterns of bias and discrimination.”
Hood, who leads the Office of the Comptroller of the Currency (OCC), repeated his support for financial inclusion, which he repeated is the “is the civil rights challenge of our generation.”
“That’s why my focus on this has been unwavering, and I encourage innovative thinking among stakeholders in financial services about how we can lead the way to foster greater financial inclusion,” Hood said in recorded remarks to the National Fair Housing Alliance’s Responsible AI Symposium, meeting in Washington, D.C.
“During my tenure as the NCUA Chairman, I made financial inclusion a priority for the agency and the cooperative credit system,” Hood said. “I continue to champion this topic at the OCC because I truly believe national banks and federal savings associations should help all people to access our financial mainstream.”
Hood said OCC is a “champion” of the use of AI to expand access to credit and other financial services.
“For example, AI can utilize alternative data, such as rent payments and cash flow information, to improve credit models and increase financial inclusion. This can enable consumers to obtain additional products or more favorable terms based on enhanced assessments of repayment capacity,” he said.
The regulator asserted that fairness in housing and lending is “central to a productive, well-functioning, and prosperous society and markets and helps expand business and other opportunities.
“Conversely, unfair systems can restrict access to credit and hinder progress,” he added. Hood pointed to the OCC’s new Office of External Relations and Strategic Partnerships, which he said would be responsible for developing the agency’s “comprehensive financial inclusion strategy.”
“It will also engage with critical external stakeholders to identify economic barriers build partnerships, promote education, and encourage responsible innovation to foster increased inclusion in the federal banking system,” Hood said.
Acting Comptroller of the Currency Discusses Artificial Intelligence
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