To achieve its mission, the CFPB must embrace AI
As the Biden administration gets into full swing, many regulatory agencies are in the process of reviewing and recalibrating their agendas. In few places is this more true than at the Consumer Financial Protection Bureau, which is widely expected to emphasize enforcement and fair lending compliance now and in the years to come.
This creates an opportunity to answer President Biden’s call for racial equity by accelerating the use of new credit-scoring techniques that will bring greater fairness to American consumers. Financial inequality is one of the biggest problems our society faces today and poor access to affordable credit is a key driver.
The CFPB’s likely new director, Rohit Chopra, must be bold and forward-leaning in guiding the agency’s approach to regulating innovation that can reverse this inequity. Done right, new approaches and technologies, like artificial intelligence and machine learning, can be far more transparent than historic lending models and can drive measurably a more fair and accessible financial system.