Title: A credit scoring model for personal loans
Authors: Steenackers, A ×
Goovaerts, Marc #
Issue Date: 1989
Series Title: Insurance: Mathematics & Economics vol:8 issue:1 pages:31-34
Abstract: Traditionally, the decision by a bank or credit company to grant credit to an individual is made by a specialized person who handles each demand separately. As this is a time-consuming process, financial institutions frequently make use of a credit scoring system. A logistics regression model is employed to develop a numerical scoring system for personal loans. For the selection of the characteristics in the scoring model, the occurrence of all possible values of each characteristic is analyzed separately in the sample of 995 good and 1,257 bad loans collected in a Belgian credit company. For the final selection of the characteristics, a stepwise logistics regression is performed. This technique performs numerous logistics regressions, starting with the single variable with the most predictive power and adding, one by one, the variables that provide the best improvement in goodness of fit of the model, until no further single addition achieves a specified significance level
ISSN: 0167-6687
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Research Center Insurance, Leuven
× corresponding author
# (joint) last author

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