Reduce credit risk

Financial institutions continue to be exposed to risks in form of bad debts, poor investments, poorly assessed clientele, and marketing the wrong product in their portfolio.

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These institutions have a rich endowment of their customer data but underutilise it. They only concentrate on the financial metrics and a few other financial indicators rather than the qualitative behaviour this data unearths that is crucial in predicting likelihood of default.

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The location, marital status and employment status are some of those essential metrics that can be utilised in stress testing chances of default. These qualitative metrics tell a lot about a person’s lifestyle and what potential barriers they have to clearing their arrears.

With the massive amounts of data banks collect when you’re registering for a bank account, this shouldn’t be a problem. Yet the percentage of Non-Performing Loans (NPLs) keeps accruing year on year.

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