Big Data Analytics and AI‐Driven Decision Support Systems for Financial Inclusion and Microfinance Risk Assessment

The convergence of big data analytics and artificial intelligence (AI) has fundamentally altered the landscape of financial inclusion and microfinance risk assessment. This chapter focuses on advanced computational systems, machine learning and decision support systems to help microfinance institutions provide credit to previously underserved populations, thereby making their operations sustainable. Drawing on the latest innovations in predictive analytics, natural language processing and alternative data sources, the chapter discusses how AI-based systems are transforming credit scoring, risk profiling and portfolio management in the microfinance industry. The chapter shows how these technological advances are closing the financial inclusion gap and overcoming the specific challenges of serving low-income populations in emerging markets. It also discusses the entire range of technologies, such as gathering and preprocessing data, the modeling of systems and their implementation, and touch upon such important aspects of the work as the fairness of algorithms, compliance with regulations and ethical issues.