The Monetary Authority of Singapore is using AI to help financial institutions assess the sustainability performance of Singapore’s real estate sector. MAS said the NovA!, part of the National Artificial Intelligence Programme in Finance, is aimed at helping FIs harness AI to generate insights on financial risk. In the initial phase, the programme will focus on enhancing FIs’ ability to assess companies’ environmental impact and identify emerging environmental risks.
FIs would be able to tap on the AI for their Environmental, Social, and Governance risk assessment for originating, underwriting, and servicing sustainability linked loans.
- At loan origination, FIs can use the service to identify real estate corporate borrowers whose sustainability metrics can be improved, by comparing their historical environmental performance to that of their peers, and during underwriting, it will assist FIs to set appropriate sustainability performance targets for the borrowers, by comparing borrowers’ SPTs with the SPT Industry Benchmark generated by the software. As for servicing of loans, the system will compare the actual sustainability performance indicators (through direct use of meters or sensors) against the borrower’s self-declaration to detect greenwashing.
The NovA! ESG use case will also reduce the amount of time it takes for FIs to collect, process, and analyse data through the use of natural language processing technique to automatically extract relevant information from documents. This will reduce the overall cost of operations for FIs.
To support FIs’ sustainability journeys, NovA!’s ESG use case will be integrated with MAS’ Project Greenprint. Greenprint is a collection of digital data utilities and initiatives aimed at harnessing technology and data to aggregate high-quality, consistent, and granular sustainability data, to enable a transparent, trusted, and efficient ESG ecosystem. Datasets collected via Greenprint will be used to supplement NovA!’s insights-generation capabilities, which will be accessible to Greenprint partners via APIs.
