Financial Services, We Have a problem
In the past decade, the financial world has been digitalized through the introduction of artificial intelligence (AI) and machine learning. Many parts of banking, lending and insurance decision-making processes are now being made by algorithms. The pandemic has accelerated this use of technology and while it has delivered many positive outcomes, these vital algorithms can only be as ‘fair’ and unbiased as the data sets that are used to build them. The industry must check if the biases that exist in society are being repeated through the design of these technologies.
Finastra is taking a stand against algorithmic bias and is asking the financial services ecosystem to join us in this movement to deliver fairness and equality to individuals, businesses and global communities.
Algorithmic Bias and Financial Services
A KPMG report commissioned by Finastra
To explore algorithmic bias in financial services, Finastra commissioned a report from global consultants KPMG. It comprehensively covers the various types of bias and how they can impact financial services lending. Explore the report here.
We Pledge to Ensure That We Continuously Work to Challenge Bias in Fintech and Financial Services
Reforming Finastra’s Developer Agreement
Finastra has updated its developer terms and conditions for FusionFabric.cloud, its open platform and marketplace for developers. This means developers and partners will be expected to account for algorithmic bias and Finastra has the right to inspect for this bias within any new application.
Hacking for Good
Finastra commits to all future hacks having a focus on inclusion. To support this, Finastra will be launching a global hacking competition as part of its Hack to the Future series to shine a light on female talent in the industry by finding and celebrating balanced, female-led teams pushing the boundaries of AI and machine learning.
Within the organization, Finastra is continuing its journey to 50:50 male to female ratios across all its teams. This includes increasing women amongst our top 200 leaders and engineers from 30% to 40% by 2025 and to 50% by 2030.
Creating New Proof of Concept Technologies
Such as FinEqual, a digital tool that enables bias-free lending, to give users the technology to empower them to tackle algorithmic bias within their own businesses. Currently at proof-of-concept stage, Finastra aims to make FinEqual available to customers in the next 18 months.
Work With Regulators
Finastra is fully committed to tackling AI bias. The company is working closely with regulators in multiple markets and, as a technology leader, is calling upon the financial services industry to take note of the threat algorithmic bias poses to society.
Hack to the Future Winners
Together we accelerated the transformation to redefine finance for good.
Bloinx: A decentralized application using blockchain technology to help build savings communities by operating as a ROSCA administrator through smart contracts. Rotating credit and savings associations (ROSCA) e.g. tandas in Mexico, enable people with lack of financial knowledge and access to credit cards and bank loans to obtain money quickly through a money-pooling fund.
tinch.: An agri-fintech initiative to tackle bias against women in the agriculture sector when it comes to market price, access to agricultural loans and land availability.
Qualify - Growth Simplified: A peer-to-peer lending platform to help low-income communities generate credit scores and gain access to formal credit.