Financial Technology with AI-Enabled and Ethical Challenges

Financial Technology (FinTech) has become a disruptive innovation. Being one form of FinTech financing, peer-to-peer (P2P) lending has been widely developed and has grown rapidly for the last few years. The main challenge for P2P lending is on managing risks. FinTech with artificial intelligence (AI) can be used as a strategic tool in mitigating risks for FinTech companies in assessing creditworthiness of a potential customer. However, AI-enabled assessment has created several ethical issues and dilemmas for the stakeholders in the industry. This paper aims to examine the ethical issues and dilemmas by deploying theories of consequentialism and deontology in assisting an ethical decision-making process. An AI-enabled risk assessment will automate processes in understanding potential applicants for P2P lending. The automation process can potentially mitigate any ethical shortcomings as well as the negative impacts in mining the potential customer’s data.