AI-Based Housing Loan Screening Spreading in Japan

October 5, 2018

Tokyo- A move to speed up the process of screening housing loans by using artificial intelligence technology is spreading in the Japanese banking industry.

On Monday, MUFG Bank, a unit of Mitsubishi UFJ Financial Group Inc. started a service in which the advance screening for housing loans is finished in a minimum of 15 minutes by using AI.

MUFG's service is offered to people using the Suumo real estate information website, operated by Recruit Sumai Co., a subsidiary of Recruit Holdings Co. .

After users fill in 22 questions, including those on annual income and the desired amount of loans, results are sent by email in as soon as 15 minutes.

Until now, it took an entire day for customers to be notified of the screening results as they had to fill in a form containing as much as 57 questions and the process of screening relied heavily on manpower.

Mizuho Bank, a unit of Mizuho Financial Group Inc. <8411>, has started testing a housing loan screening process using an AI that learned a large amount of data. The bank aims to put it into practical use in the fiscal year that begins in April 2019.

Online banks are taking the lead in introducing AI into housing loan screening.

In November last year, SBI Sumishin Net Bank introduced AI in its screening process. In May this year, Sony Bank, a unit of Sony Financial Holdings Inc., started a new service that enables the preliminary review to be completed in as soon as an hour.

AI-based housing loan screening helps ease the burden for applicants to fill out information and allows them to see whether they can take out loans quickly. "This will help acquire new customers," an MUFG Bank official said.

The introduction of AI is also designed to improve operational efficiency and cut jobs as banks are struggling with low interest rates and a shrinking customer base. Jiji Press