The Consumer Financial Protection Bureau issued guidance about certain legal requirements that lenders must adhere to when using artificial intelligence and other complex models.
CFPB issues guidance on credit denials by lenders using AI
September 20, 2023 / By ICBA
The Consumer Financial Protection Bureau issued guidance about certain legal requirements that lenders must adhere to when using artificial intelligence and other complex models.
The Consumer Financial Protection Bureau issued guidance about certain legal requirements that lenders must adhere to when using artificial intelligence and other complex models.
Details: The guidance says:
Lenders must use specific and accurate reasons when taking adverse actions against consumers.
Creditors cannot simply use the CFPB’s sample adverse-action forms and checklists if they do not reflect the actual reason for the denial of credit or a change of credit conditions.
This requirement is especially important with the growth of advanced algorithms and personal consumer data in credit underwriting.
Subscribe now
Sign up for the Independent Banker newsletter to receive twice-monthly emails about new issues and must-read content you might have missed.
Sponsored Content
Featured Webinars
Join ICBA Community
Interested in discussing this and other topics? Network with and learn from your peers with the app designed for community bankers.
Subscribe Today
Sign up for Independent Banker eNews to receive twice-monthly emails that alert you when a new issue drops and highlight must-read content you might have missed.
News Watch Today
Join the Conversation with ICBA Community
ICBA Community is an online platform led by community bankers to foster connections, collaborations, and discussions on industry news, best practices, and regulations, while promoting networking, mentorship, and member feedback to guide future initiatives.
Join the Community Example Text
