IFRS9 Changing the Future of Credit Risk
Compliance a Market Differentiator
IFRS 9 is another regulation increasing compliance cost.
Yet it is also an opportunity.
Turn the process of provision calculation into rethinking credit risk.
Turn the compliance cost into increased revenue streams.
Use IFRS 9 to tap into new market segments that have been ignored.
Use IFRS 9 to driver proper risk based pricing.
Use managed risk to drive margin.
GIG Economy, SME lending and Changing Markets
The tradtional Full Time employee is declining.
More staff are on contract and more workers are self employed.
Near 50% of the work force does not fit traditional lending requirements.
House prices means that there is a generation with out equity who cannot take out mortgage backed business loans.
Regulators are dismantling traditional methods of securing loans.
Digital disruptors are changing the profile of risk.
Traditional banking is locked into a shrinking market where price is the only differentiator.
It is critical for financial institutions to rethink Credit Risk to maintain market share and rebuild margins.
Cognitive Computing Reshaping Credit Risk
It takes as long to assess a large loan as it does a small loan so banks ignore small loans.
Yet the business they ignore is the high margin business that is often low risk.
The reason it is so costly is that the assessment is done by people.
Use cognitive computing instead and the cost issue disappears.
This is the changing business model of banking.
Digital technology is changing the credit models and traditional banking will be left behind.
So don’t just comply with IFRS 9.
Look at how to change Credit Risk models to become a digital bank of the future.