INPROFORUM Junior 2012

Theoretical examples of use of credit scoring
Martin Klicnar

Language: cs
Last modified: 2013-06-21

Abstract


Credit scoring is widely used tool in financial institutions. In this article various practical ways of its use will be described and explained. Not only setting of strategies which customers to be approved or declined, but also how to set basic parameters of products. Essential use of credit scoring is for managing of risk, however (as it will be showed here) it could be used for managing of total credit level.


Keywords


Credit scoring, interest rate, cut-off, probability of default, risk based pricing

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