AI for banks: new tools for business growth in the FBK and Dedagroup Business Solutions research project
Accelerating territorial development and business growth is the goal of the AIAAA project, which capitalizes on the experience and assets developed in the Co-Innovation Lab in which FBK and Dedagroup collaborate to develop Open Data and Open Services.
Supporting financial institutions in better responding to the needs of businesses through more efficient services that leverage the full potential of frontier technologies. This is with this promise that Dedagroup Business Solutions, a Dedagroup company that responds to the innovation needs of financial institutions and businesses thanks to its in-depth knowledge of the processes and regulations of the Finance and Large Corporate markets, and Fondazione Bruno Kessler (FBK) will pool their respective expertise for the development of AIAAA – Applications of Artificial Intelligence and Advanced Analytics – a project also realized thanks to the support of a grant from the Autonomous Province of Trento. AIAAA
capitalizes on the experience and assets developed in the Co-Innovation Lab, a joint laboratory between Dedagroup and FBK, dedicated to the development of best practices, methodologies and technologies in an Open Innovation logic, created in 2016 to bring concrete innovation to companies and institutions in the field of Public Services and in the Finance world. The collaboration led to the creation of the Digital Hub, a data and service interoperability platform designed to make data sources available quickly and easily, thereby facilitating their use and enabling a data-driven approach.
“It continues the fruitful collaboration between our Group and Fondazione Bruno Kessler with whom, over the past years together, we have worked to bring concrete innovation within companies and institutions and contribute to the country’s digitization process,” said Gianni Spada, CEO of Dedagroup Business Solutions. “In particular, with the AIAAA project we aim to strengthen the relationship between banks and businesses – nowadays as crucial and strategic as ever for the grounding of the PNRR – creating innovative environments and platforms in which knowledge, analysis and interpretation of data give rise to new services and business models capable of bringing even more value to all stakeholders, expanding the portfolio of solutions offered by our group Finance & Data Hub.
“To accelerate the digitization and innovation of our country,” Marco Pistore, Director of the Bruno Kessler Foundation’s Center for the Digital Society added. “Bridging the gap between research, business and public administration is critical. It is indeed very important that this digitization also takes full advantage of the latest results of research and technological innovation, especially in areas, such as Artificial Intelligence, where progress is occurring at a very fast pace. Platforms such as the Digital Hub, built on knowledge and technologies shared by research and business and developed in co-innovation labs such as the one we have with Dedagroup, thus become a key enabler for digitization.”
For AIAAA – that should end in June 2023 – Dedagroup Business Solutions and FBK will develop and integrate into the Digital Hub a new Intelligent Migration Machine for financial institutions and companies designed to improve the Merger & Acquisition process in all financial and production sectors. It is estimated that, thanks to the optimization of the data analysis stages, the time and costs of an M&A process can be cut in half.
At the same time, the Company and the research organization will devote themselves to the definition of a Simulation Environment, also integrated into the Digital Hub, capable of applying different trend scenarios on the data of companies and financial institutions by generating realistic forecast situations, built taking into account the macroeconomic environment, sectoral spillover and the peculiarities of each company. Concretely, the Simulation Environment will enable banks to estimate the financial risk of their customers, insurance companies to examine the profitability of their customer portfolios, and businesses to evaluate their business plans. Finally, a Platform based on the creation of intelligent apps
Finally, a Platform based on the creation of intelligent apps will be created for financial institutions, businesses, and citizens. Specifically, three applications will be developed:
- for lending institutions, an application that leverages artificial intelligence models, supporting them in creating financial forecasts and stress tests, within their credit disbursement and monitoring processes. Starting from companies’ balance sheet data, the intelligent app allows them to simulate how exogenous shocks (shrinking turnover and revenues, increasing incidence of variable costs on companies’ turnovers and financial expenses) may impact their financial performance from a forward-looking perspective. Based on the results obtained, financial institutions will be able to assess the health of companies, and thus evaluate the provision of credit.
- Creditor/Debtor Risk Analyzer app: for financial institutions and corporations, it enables predictive analysis of debtors’ payment behaviors by predicting the deviation of an individual payment from its contractual due date and identifying variations in these behaviors that can be interpreted for early warning purposes. The app leverages not only the debtor company’s cash flow data (invoices/payments) but also the company’s historical and prospective financial indicators and other information from outside the organization.
- Wellness App: with total respect for privacy, it monitors people’s vital parameters to create indicators about their lifestyle, useful for improving their health and socialization. The app can be connected to an insurance company’s protection program, which will be able to charge the “best” insurance premium based on the lifestyle of its policy holders, while also providing rewards throughout the year based on achievements. Thus, the app’s targets are, on the one hand, insurance companies and, on the other hand, companies that can promote a wellness program for their employees while improving their ESG rating.