Application of Artificial Intelligence Technology Optimized by Deep Learning to Rural Financial Development and Rural Governance

Application of Artificial Intelligence Technology Optimized by Deep Learning to Rural Financial Development and Rural Governance

Hongwei Hou, Kunzhi Tang, Xiaoqian Liu, Yue Zhou
Copyright: © 2022 |Pages: 23
DOI: 10.4018/JGIM.289220
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Abstract

The aim of this article is to promote the development of rural finance and the further informatization of rural banks. Based on DL (deep learning) and artificial intelligence technology, data pre-processing and feature selection are conducted on the customer information of rural banks in a certain region, including the historical deposit and loan, transaction record, and credit information. Besides, four DL models are proposed with a precision of more than 87% by test to improve the simulation effect and explore the application of DL. The BLSTM-CNN (Bi-directional Long Short-Term Memory-Convolutional Neural Network) model with a precision of 95.8%, which integrates RNN (Recurrent Neural Network) and CNN (Convolutional Neural Network) in parallel, solves the shortcomings of RNN and CNN separately. The research result can provide a more reasonable prediction model for rural banks, and ideas for the development of rural informatization and promoting rural governance.
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Introduction

With the widespread popularity of mobile devices, the booming mobile Internet provides enterprises with more access to customer information, thus promoting the rapid development and broad application of big data, data storage, cloud computing, and other technologies (Lee and Oh, 2020). Besides, AI (artificial intelligence) technology has fast grown, benefiting from the rapid growth of data and the enhancement of computing power (Wang et al., 2020a). In this context, the traditional rural financial industry is facing peer competition within the industry and challenges from the Internet financial industry (Ye et al., 2018). For data-driven business industries such as banks, there are urgent requirements for business according to different demands, including obtaining practical value from the data, conducting business more effectively for various customer groups, exploring the potential value of data, and earning more incredible benefits. Bank enterprises combine data analysis, data mining, and machine learning models with actual business for customer group division, customer churn prediction, customer behavior information analysis, and customer credit prediction division. However, most of these methods are in the stage of research and preliminary application. In the actual production, the use of data is not sufficient and reasonable. Furthermore, the application of big data technology and AI technology in the banking industry is still in its infancy, and there is still much room for development. Rewilak (2017) used AI technology to study whether financial development was conducive to rural poverty reduction. They found that financial deepening and greater physical access are conducive to reducing people below the poverty line. They used alternative measures of economic instability, and the results also challenged existing findings that economic instability may increase the incidence of poverty (Rewilak, 2017). To lessen the complexity and time consumption of traditional statistical and mathematical planning methods, Metawa et al. (2017) used AI technology to conduct research and analysis on rural finance. They proposed an intelligent credit decision model for rural banks based on a genetic algorithm. This model could provide a framework for optimizing bank objectives when constructing loan portfolios and seek dynamic loan decisions by maximizing bank profits and minimizing bank default probability. This model was more intelligent than the previous methods, which could shorten the screening time of bank’s loan by 12% to 50%, and meanwhile increase rural bank profit by 3.9% to 8.1% (Metawa et al., 2017).

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