LOS ANGELES, March 19, 2019 /PRNewswire/ -- Today ZestFinance, a leader in artificial intelligence (AI) software for credit, launched ZAML Fair™, a new software tool to reduce bias and discrimination in lending. ZAML Fair is the latest extension to ZestFinance's flagship ZAML platform, which lenders around the world rely on to safely develop and deploy machine learning (ML) credit underwriting.
ZAML Fair is a new algorithm that lenders can use to tune models for maximum fairness by automatically reducing the impact of discriminatory credit data. ZAML Fair uses the transparency tools built into ZAML to rank credit signals by how much they lead to biased outcomes and then produces a new model with maximum fairness and accuracy. ZAML Fair carefully reduces the influence of factors that drive disparity, including some common credit signals such as income and the traditional credit score. Lenders get a series of better models they can choose from at a fraction of the time and effort required by legacy techniques.
Several mortgage lenders have already tested the ZAML Fair algorithm. Based on those results, ZAML Fair would eliminate 70% of the gap in U.S. mortgage approval rates between Hispanic and white borrowers and cut the even larger gap between black and white borrowers by more than 40%. And that is just by using the technology to tune up traditional credit models. This would put more than 172,000 minority families into new homes.
"The way lenders take bias out of their models today is by simply tossing out offending credit signals. That leaves a lot of performance on the table," said Douglas Merrill, founder and CEO of ZestFinance. "Banks shouldn't have to choose between fairness and accuracy, and ZAML Fair helps them optimize for both."
ZAML Fair is available now for all ZAML platform customers.
ZestFinance helps lenders use machine learning to develop and launch highly accurate and explainable credit risk models. ZestFinance's software tools enable our clients to increase revenues, reduce risk, and ensure compliance. ZestFinance was founded in 2009 by Douglas Merrill, the former CIO of Google, and a team of former Google employees with the mission of making fair and transparent credit available to everyone. The company is headquartered in Los Angeles, California. For more information, visit www.ZestFinance.com.