← Search

Smart Natural Disaster Relief: Assisting Victims with Artificial Intelligence in Lending

Yidi Liu¹; Xin Li²; Zhiqiang Zheng³

¹ School of Management and Economics and Shenzhen Finance Institute, Chinese University of Hong Kong, Shenzhen, Shenzhen 518172, China; · ² Department of Information Systems, College of Business, City University of Hong Kong, Hong Kong; · ³ Department of Information Systems and Operations Management, Jindal School of Management, University of Texas at Dallas, Richardson, Texas 75080

Natural disasters can have devastating economic and financial consequences for those affected. This research note explores the potential of artificial intelligence (AI) in disaster relief through lending services. By collaborating with a credit-scoring company, we investigate how AI-empowered lenders can effectively reduce delinquency rates for borrowers in the aftermath of disasters. Our findings reveal that borrowers applying to lenders that utilize AI in their loan assessment process experience improved outcomes in terms of delinquency reduction, particularly for borrowers with lower credit scores. This research underscores the positive impact of AI in the lending context, benefiting both lenders and borrowers. Furthermore, we highlight that AI indirectly supports disaster relief efforts through financing, providing a compelling use case for AI fairness in lending. Our findings have significant implications for leveraging AI as a valuable tool in mitigating the financial impact of disasters and promoting fairness in lending practices.

DOI

10.1287/isre.2023.1230

Volume

35 (2)

Pages

489-504

Language

en

Export

BibTeX

Sources

crossref