{"type":"rich","version":"1.0","provider_name":"Transistor","provider_url":"https://transistor.fm","author_name":"Future Around & Find Out","title":"Lending + AI: How Branch Lends to People Banks Won’t Touch | Matt Flannery (Founder and CEO of Branch; Founder of Kiva) ","html":"","width":"100%","height":180,"duration":1948,"description":"Matt Flannery and Branch have done something the banks have not: learned how to profitably lend to people who have little to no credit history. Matt is the founder and CEO of Branch, which issues small loans to millions of people in India, Nigeria, Kenya, and Tanzania. He's also the founder of Kiva, a microfinance pioneer that skyrocketed from a small project into a worldwide nonprofit that Oprah and President Clinton loved talking about. On this episode of CRAFTED., we learn how Branch uses data from people's phones to confidently make loans to people who don't have traditional credit scores. Plus, how they prevent fraud and avoid bias. We'll also explore the wild ways that Branch is experimenting with Generative AI, including how they are creating “future synthetic data” that they believe will predict how users will save and spend in the future. Takeaways:Branch uses AI to confidently lend to people without traditional credit scoresBranch was built on traditional machine learning models – the name “Branch” derives in part from the “random forest” approach – and now is adding Generative AI approaches to the mixBranch is using GenAI to create “future synthetic data” that predicts how people will spend and save in the years to come. As Matt says, “it’s kind of a wild idea” and it’ll take a few years to see how predictive the approach isTo avoid bias, lend to lots of people no matter what the data says. It will teach you what the “natural loss rate” is and prevent you from training your model on customers you’ve already selected as creditworthy.Preventing fraud is the biggest challenge. And you can go from zero fraud to massive fraud over a weekend if fraudsters discover a vulnerability.Branch is hugely successful in India, because of the approach it developed in Africa: lend very small amounts to lots of people and, as people repay, offer them larger loans. Branch failed in Mexico, because the user experience of repaying the loan (visiting a local shop) was too...","thumbnail_url":"https://img.transistorcdn.com/HUxsFUd2l2IpBZewHzlZlthVWOmLB5qSDYnIlkRo0LE/rs:fill:0:0:1/w:400/h:400/q:60/mb:500000/aHR0cHM6Ly9pbWct/dXBsb2FkLXByb2R1/Y3Rpb24udHJhbnNp/c3Rvci5mbS82YTcx/YWIxYzkxYjgwNWI4/MTc5NGYyNjliZjU5/NzQ4MC5qcGc.webp","thumbnail_width":300,"thumbnail_height":300}