June 10, 2018 (RIA Novosti) - Artificial intelligence is gradually replacing debt collection companies in China, Russian media said, with some P2P borrowing platforms experimenting with this new technology for repaying debts - AI searches for information about a debtor on the Internet, including contact information for his friends and family, and starts making phone calls, sending SMS asking for debt repayment, while the robot sketches a mental portrait of the other party with the help of semantic analysis and chooses the right words to urge him to repay the debt.
Russian satellite network on June 6 published a report titled "China's artificial intelligence or replace the debt collection company? The report said that P2P borrowing platforms appeared in China about 10 years ago, and the market is growing at a triple-digit rate every year. According to statistics, the maturing debt of P2P borrowing platforms has reached 1.3 trillion yuan, so there is also a demand for some unconventional debt collection methods in the market. Some of them, such as asking for nude photos as collateral or sending "square dancers" to debtors' homes to dance to deafening music, have drawn the attention of China's law enforcement authorities.
Liu Ying, a researcher at Renmin University's Chongyang Institute of Financial Studies, told the satellite news agency in an interview that the use of artificial intelligence to collect debts is now legal.
Liu Ying said, "AI collection systems can collect and collect money from debtors at the upstream, midstream and downstream business levels, requesting repayment by sending emails, sending text messages and making phone calls, but that's just where it ends. AI collections cannot limit or affect other people related to the debtor, such as his friends and family, and this limit and boundary requires strict legal intervention. The innovation of financial technology needs a supporting professional regulatory system and relevant legislation as a guarantee, and the application of intelligent collection should not be allowed to appear in such a situation - as a result of a certain person owes money and has not been paid back, in addition to the collection of his own, but also the use of the so-called high-tech means of his friends and relatives indiscriminately, the practice itself is illegal behavior, and other people related to the debtor should not be harassed because of the collection of arrears. Even in ancient China, there was the saying that 'a father's debt should be repaid by his son', but it was only limited to the 'son's' generation, rather than targeting at all the people related to the debtor. Therefore, the application of high technology should likewise not cross the bottom line of the law."
But using AI to collect debts, for the time being, relies more often on the same pain points that Chinese people have always had, such as feeling shy in front of loved ones, the report said. The bots will look for the debtor's contacts and profiles on the Internet, look for his friends' profiles on social networks, and call and text everyone. Using semantic analysis and big data processing methods, the artificial intelligence draws a portrait of the debtor's heart in order to choose the most convincing debt collection strategy, requesting friends and family to influence the debtor they know well.
The report said the strategy has worked so well that the system has helped nearly 200 creditors recover their debts. The AI is twice as efficient as traditional debt-collection agencies, according to Shanghai-based asset-processing service provider Ziyitong, and in May alone it recovered 41 percent of renegade debts, compared with a 20 percent success rate for debt-collection agencies.
Liu Ying pointed out that the success of AI also lies in the fact that both P2P and microfinance are types of technology for financial services, so AI is easy to implant.
Liu Ying went on to say, "The reason why AI can be applied and effective in the field of collection is because Internet finance such as cash loans is a kind of fintech in itself, and Internet finance and tech credits have features such as being online, recordable, traceable, linkable, etc., which makes them work well with technologies such as AI and blockchain technology to the effect of expanding the effect of economies of scale and reducing marginal costs. That said, AI technology may not always be as effective when applied to the traditional credit market."
The report said that both internet companies and traditional banking institutions are working hard to develop technology for the financial industry, and given the future existence of a digital banking system under strict credit restrictions, it can be assumed that the demand for robotic debt collectors can only increase.
Source? Sina News