UNIT 6
CREDIT SCORING
v
(i) Credit Risk - Customer fails to pay
(ii) Business Risk - Loosing money due to wrong strategy.
(iii) Market Risk - Change in market prices.
(iv)Operations Risk- Processing failures and frauds
v Cibil-TransUnion model gives scores ranging from 300 to 900
v
Credit
Scoring Models are based on the following details of applicants:
(i) Family Size
(ii) Income Levels
(iii) Occupation/Business
(iv) Repayment History on earlier loans
v
The most
common mistakes in credit score will be due to the following;
(i) Confusion of names
(ii) Human Input Error
(iii) Identity Theft
