Artificial Intelligence (AI) may not replace human lenders but lenders who harness AI are quickly outpacing those who don’t. That’s the message emerging from recent data and global case studies that illustrate how AI is redefining the lending landscape.

In the United States, fintech company Upstart claims its AI-driven credit models significantly outperform traditional FICO scoring. According to the company, their system demonstrates five times better precision in distinguishing between low- and high-risk borrowers. This enhanced risk differentiation has translated into higher loan approval rates without increasing default levels.

Similarly, Zest AI, another U.S.-based fintech, reports helping credit unions increase their approval rates by 20–25% while maintaining risk at a constant level. Notably, lenders working with underserved communities experienced 30–40% lower delinquency rates compared to industry peers. Zest AI also reported significant improvements in approvals among protected classes with Latino applicants seeing a 49% increase and Black applicants a 41% rise achieved without compromising on credit risk.

Across the globe in China, Ant Group is making massive investments to integrate AI in lending. In 2024, the company invested a record ¥23.45 billion (approximately USD 3.26 billion) in R&D, a significant portion of which was directed towards enhancing AI-powered risk engines. These tools are enabling real-time underwriting and approvals for over one billion users.

From scoring new-to-credit borrowers using alternative data to predicting collection risk and personalizing repayment strategies, AI is not replacing human judgment but rather enhancing it with speed, precision, and scalability.

Experts suggest that lenders who adopt AI responsibly emphasizing transparency, fairness, and explainability are already gaining a competitive edge. As the financial industry evolves, it’s becoming increasingly clear: AI won’t replace lenders, but lenders using AI will replace those who don’t.