The Use of Artificial Intelligence to Promote the Financial Inclusion of Rural and Agricultural Actors

This study explores the potential that different applications of artificial intelligence (AI) technology can have to promote the financial inclusion of marginalized rural and agricultural actors in developing countries. These low-income, vulnerable actors have been traditionally underserved by the formal financial sector on account of a wide range of constraints: low access to collateral, poor financial education, the absence of credit history, a lack of basic documentation and many others. 

While the use of AI in financial systems is still in a nascent stage, we can already see various pilot applications of this technology that appear to hold considerable promise when it comes to addressing these constraints, and can thereby contribute to a more equitable, comprehensive, and efficient growth of financial inclusion in developing and emerging countries. 

The paper looks at different lines of AI innovation in rural and agricultural finance, including enhanced credit risk scoring, biometric authentication for marginalized financial consumers, AI chatbots and the use of AI in agricultural insurance. It also analyzes the possible risks and pitfalls associated with the uptake and dissemination of AI-powered solutions in rural and agricultural finance, especially gender bias.

The study seeks to assist policymakers, formal financial institutions (FIs), and other relevant stakeholders in avoiding this and other possible pitfalls, so that AI-powered solutions can be leveraged to promote financial access among the unbanked in a truly inclusive and fair manner