KBank devoted to big data approvals
Kasikornbank (KBank), the country’s fourth-largest lender by assets, wants to substantially raise the rate of its new small and medium-sized enterprise (SME) loan approvals determined through big data analytics to 30% this year.
The bank started using big data analytics and artificial intelligence (AI) technology for SME loan approval since last year, approving 22.5 billion baht worth of loans, or 10% of new SME loan, said executive vice-president Surat Leelataviwat.
KBank aims to grant 75 billion baht worth of new SME loans using its data analytics and AI technology this year.
Customer databases, business cycles, seasonal factors, and financial behaviour are the key information that indicates clients’ loan demand, allowing the bank to better respond to their needs, he said.
The technology offers a higher approval rate and better asset quality for SME loans than traditional systems. Less than 1% of loans approved using big data and AI turned sour, said Mr Surat.
Despite the better loan quality, KBank charges the same rate for SME loans approved using the new technology as traditional loan analysis systems: 1-2% on top of the minimum retail rate for small SMEs, and the minimum lending rate plus a risk premium for mid-sized SMEs.
KBank, the country’s largest SME lender, has an SME loan portfolio of around 700 billion baht. He said users of the bank’s mobile app KPlus now number 10.8 million.
In related news, the bank teamed up with the Electronic Transactions Development Agency, Google Thailand and Line to launch “K SME Good to Great” programme, aimed at promoting the omni-channel business model for SMEs. It offers knowledge, in-depth advice from renowned experts, and prizes worth 100,000 baht to five selected SME participants.
Mr Surat said the bank delivered marginal SME loan growth during the first quarter this year, partly because of ample debt repayment. KBank is keeping its loan growth target in a range of 4-6% this year.
KBANK shares closed yesterday on the SET at 194.50 baht, down two baht, in trade worth 2.39 billion baht.