Methods and Algorithms for Constructing Credit Scoring Systems

Zhukovska Olga

Анотація

One of the most important tools for ensuring the sustainable operation of banks is creditscoring modeling. The need for credit scoring models arose as a result of the competition of a rapidly growing number of banks that competed for each client and therefore the speed of decision-making was an important factor. The ancestor of modern credit scoring systems was the Durant model in 1937, who first conducted research to find factors that could separate bad and good borrowers. As a result of the analysis of credit histories, he identified factors that make it possible to assess the degree of credit risk, and also proposed a method for assessing a potential borrower. Subsequently, the rapid development of computer technology made it possible to completely abandon the loan officer, thereby providing an objective solution.