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Westpac looks to give business customers an AI edge

09:00am January 18 2023

Shane Howell, managing director of business lending at Westpac, and Ada Guan, CEO and co-founder of Rich Data Co. 

Westpac is partnering with a Sydney-based tech company to deploy artificial intelligence that will simplify and accelerate its business lending services. 

Rich Data Co.’s technology will give bankers rapid access to more detailed data, helping them to make quicker decisions on whether a customer is eligible for different types of products. 

“With this partnership between Westpac and RDC we’re breaking new ground in applying AI to get a deeper understanding of the behaviour of business customers,” said Ada Guan, CEO and co-founder of RDC. 

Speaking of the motivation behind starting the company in 2016, Guan noted that a gap in understanding between borrowers and the banks was often an impediment to businesses obtaining credit. 

“With the progress of AI, we felt that if we can enable the banks to get a better understanding of the borrowers behaviour then we can help them to extend that much needed credit to the sector.”

AI uses a borrower’s transaction data to find patterns and provide insights into their cashflow health. Specifically, the historical data is used to make forward projections. 

“That look into the future is the core capability we are offering,” Guan said. “Based on that you can do more product innovation, you can look at how to best offer credit.”

She cites the example of a small retail operator, who can have a “bumpy” earnings profile. In providing a past, present and future view of a business’s performance, AI can help bankers look through any seasonal volatility to get a more holistic view of whether it should be given credit or not. 

"We want to give our customers fast decisions and provide a simple and informed experience. This work gives us a deeper understanding of our customers, so that we can support and provide insights as and when they need it,” said Shane Howell, managing director of business lending at Westpac.

Capabilities also include a two-sided digital finance application form, which allows both customers and bankers to jointly work on an application for a faster experience. 

Like Westpac, RDC was committed to the highest standards for the ethical use of data and the protection of customer privacy, Guan said. 

Australian banks are ahead of the pack in terms of using AI to improve efficiency, Guan said, but there’s still a long way to go.

“We are still at the start of the journey in AI, especially in the business lending segment,” she said. RDC is also increasingly focused on sustainable lending, and how AI can be used to give a deeper understanding of the climate risks attached to a lending portfolio. 

James Thornhill was appointed as editor of Westpac Wire in May 2022. Prior to joining the bank, he was a business and financial journalist with more than two decades of experience with international newswires. Most recently, he was a resources correspondent for Bloomberg, covering the mining and energy sectors, and previously reported on a broad range of topics from economics and politics to currency and bond markets. Originally from the UK, he’s had stints working in London, New York and Singapore, but is now happily settled in Sydney.

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