Singapore develops “fairness metrics” for AI adoption in finance
The Monetary Authority of Singapore (MAS) has announced it is developing “fairness metrics” for two financial use cases: credit risk scoring and customer marketing.
Under the first phase of its Veritas initiative, which is aimed at promoting responsible use of artificial intelligence (AI) in financial services, the regulator is working with a consortium of financial firms to create the metrics.
United Overseas Bank (UOB) and Canadian AI start-up Element AI are tasked with developing AI-driven metrics which do not “systematically disadvantage” individuals or groups when determining their credit risk scoring.
Whilst UOB and Element AI work on credit risk scoring, HSBC, Insurance Australia Group’s (IAG) start-up incubator Firemark Labs, and not-for-profit research institute Gradient Institute will develop the metrics on customer marketing.
This metric aims to recommend “the right product to the right customer at the right time”, as the MAS acknowledges the increasing scope of AI as a tool to analyse customer data and match it with products or services.
“Veritas is the first industry-wide collaboration to provide a mathematical way to validate AIDA [AI and data analytics] solutions against the principles of fairness, ethics, accountability and transparency,” MAS chief fintech officer Sopnendy Mohanty said in a statement.
Once the metrics are created – the aim is by the end of this year, the regulator will publish a white paper along with the open-source code which financial services institutions can plug into their own IT environments to validate the fairness of their AI solutions.
The consortium is made up of 25 financial firms in total. Citi, another member, says “the responsible use of AI is a prerequisite for the greater adoption of AI in the financial sector”.
“While artificial intelligence brings significant benefits to the financial sector, maximizing its potential will require the financial ecosystem to concurrently advance the responsible use of this technology,” Citi’s ASEAN [Association of Southeast Asian Nations] head and country officer for Singapore, Amol Gupte, told finews.asia.