On April 29, Acting Comptroller of the Currency Rodney Hood delivered pre-recorded remarks at the National Fair Housing Alliance’s Responsible AI Symposium. In his speech, Hood reiterated the OCC’s commitment to deploying AI responsibly within the banking sector and highlighted the agency’s broader initiatives to promote financial inclusion.
Hood outlined several key OCC initiatives focused on the responsible use of AI in banking, including:
- Establishing a risk-based oversight framework. The OCC has issued guidance promoting transparency, accountability, and fairness in AI use in the financial services sector. Hood noted that AI should be governed by the same risk-based, technology-neutral principles that apply to other banking activities.
- Encouraging traditional risk management practices for AI. Banks should apply established model risk management principles to AI tools due to the complex nature of AI, including its use of large data sets and intricate algorithms.
- Leveraging AI for expanded access to credit. The OCC supports the use of alternative data, such as rent and cash flow information, to improve credit modeling and increase financial inclusion.
- Supporting innovation through internal infrastructure. The OCC’s Office of Financial Technology continues to monitor developments in financial technology, including AI adoption and bank-fintech partnerships, and supports supervisory and policy development efforts in those areas.
Hood also discussed the role of Project REACh (Roundtable for Economic Access and Change), an OCC-led initiative that brings together banking, community, and technology stakeholders to expand affordable credit access. Project REAch has supported pilot programs that helped establish over 100,000 accounts for consumers previously unable to access credit. New workstreams under Project REACh aim to tackle homeownership barriers and explore tech-driven inclusion strategies.
Putting It Into Practice: The OCC’s ongoing efforts to promote responsible AI use underscore the federal government’s broader commitment to ensuring AI is integrated safely and equitably into the financial services sector (previously discussed here). With the vision that AI will play a growing role in financial services, market participants should expect continued developments in the regulation of both AI applications and the use of alternative data in credit decisioning on both federal and state levels (previously discussed here, here, and here).