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This document discusses a system that can anticipate arrears, detect bias, and recommend interventions. The key features are able to anticipate arrears and detect bias with 80-90% accuracy and recommend appropriate interventions.
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S2_1_3_Vesta Insights.pptx ok to publish
- 11. ANTICIPATES ARREARS DETECTS BIAS RECOMMENDS INTERVENTIONS KEY FEATURES
- 20. 80-90%
Editor's Notes
- My name Is Veronica, I am a former VP of Data Insights Deutsche Bank and a PhD Candidate in the area of explainable AI. I am a founder of Vesta Insights which is a fintech start on a mission to reform mortgage arrears Let me share some of our insights from our R&D
- In the world of mortgage arrears, major life events like death, job loss, or divorce are often identified as the primary cause.
- However, not everyone experiencing a major life event falls into arrears. This suggests that individual circumstances matter. Surprisingly, it's not solely the person's circumstances that determine their recovery from arrears;
- the actions taken by the bank also matter. But what actions are the bank taking?
- In banking all actions are primarily driven by regulation.
- Banks have strict international standards outlining how they need to assess their risk. And for credit risk, regulation requires them to look at default - worst case scenario- the likelihood that someone will never repay their loan
- For arrears, there is no international standard however more recently a wave of new local regulations that address the management and resolution of arrears.
- But what about prevention.
- At that is what we are doing at Vesta Insights, we are anticipating arrears and shaping arrears solutions for Banks and Authorities
- But what precisely do we offer - At Vesta Insights, our AI-driven tools offer three essential features: Arrears Anticipation: We anticipating arrears. In fact, our technology predicts various categories of arrears, ranging from minor issues to foreclosure, across different timeframes. Secondly: We identify any biases in the way arrears are handled. And finally To proactively address potential issues, we provide tailored recommendations for interventions. These recommendations are designed to prevent the escalation of serious arrears problems, ultimately benefiting both lenders and borrowers.
- How do we do this - We harness state-of-the-art technology and the most up-to-date research to drive our product development including knowledge graph, Machine learning models, XAI techniques. Every facet of our product is meticulously designed to uphold the principles of true transparency and explaibaility. This extends from data storage to through model developing, all culminating in our user-friendly XUI Explainable UI for visualizing our insights.
- So thats our product but how big of a problem is arrears - Its Big! With over 975Bn of Home Loans in arrears in the US alone. And looking at the Irish Market - We have over 8.34Bn of home loans in arrears with just under 6Bn defaulted - Ireland is a glaring outlier where default is concerned. Most astounding of all is that of the 6Bn defaulted home loans -about 40% having paid a payment in over 5 years!
- So whats the market size for a product like ours? Well the Global AI Lending Market which covers all Machine Learning, NLP, Computer Vision products for lending is valued at 70Bn dollars with a compound annual growth rate of 25% forecast between 2023 to 2033
- We look to focus on the ML element of the market in two major geographical locations- North America and Europe - leaving a SAM of c22Bn. With an initial target of 1% market share in 5 years.
- How will we capture this? We will target four key customer groups - housing authorities and regulators, servicers, providers, and consulting companies
- We then will offer tier pricing for our products from 30 -250K depending on user and portfolio size
- The most useful of these is on early intervention which is developed from our novel XAI counterfactual algorithms
- That is the essence of our work at Vesta Insights. But who exactly are we? Firstly we are a team mpressive academic background, with three master's degrees, one PhD, and a PhD candidate among us. We are also super skilled and highly experienced, having skills in HCI ML Data Enginering. But most important our skills are steeped in domain knowledge. I bring over 15 years of experience in leading data and data science teams across various sectors, including finance. Our CTO, Shub, also brings a wealth of experience in finance and other industries, specializing in the design of large-scale global systems. Evan, our award-winning researcher with expertise in Human-Computer Interaction, brings valuable experience gained from conducting AI audits. His insights and perspective add another layer of depth to our team's capabilities.
- And our progress is notably. We are proud to share that our machine learning models boast accuracy rates of up to 90% when it comes to predicting arrears over a 5-year period. Our proprietary XAI counterfactual method represents our first pioneering achievement. Additionally, we have successfully developed our initial front prototype for testing our Explainable User Interface (XUI).
- What's even more exciting is that we're currently negociating terms for a pilot to test our XUI Prototype with a mortgage analytics company based in the United States. This collaboration will bring industry leaders such as Bank of America and Wells Fargo testing our prototype.
- There are three compelling reasons to choose us. First, we align perfectly with your requirements. We're proudly Irish, specializing in mortgage products, and at the forefront of innovation in our field. Secondly, our track record speaks volumes. In less than six months and with an investment of less than 20K, we've already achieved significant milestones. Finally - With over 10 interest rate hikes in the last 14 months, rising inflation, and an ongoing increase in arrears, Ireland is in need of a product like ours to address these pressing challenges.
- Thanks