Using a transactor/revolver scorecard to make credit and pricing decisions
In consumer lending the traditional approach is to develop a credit scorecard which ranks borrowers according to their risk of defaulting. Bads have a high risk of default and Goods have a low risk. To maximise the profitability of credit card customers, a second classification between revolvers and...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
2014-03.
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| Subjects: | |
| Online Access: | Get fulltext |
| LEADER | 01237 am a22001693u 4500 | ||
|---|---|---|---|
| 001 | 359696 | ||
| 042 | |a dc | ||
| 100 | 1 | 0 | |a So, M.C. |e author |
| 700 | 1 | 0 | |a Thomas, L.C. |e author |
| 700 | 1 | 0 | |a Seow, H-V |e author |
| 700 | 1 | 0 | |a Mues, C. |e author |
| 245 | 0 | 0 | |a Using a transactor/revolver scorecard to make credit and pricing decisions |
| 260 | |c 2014-03. | ||
| 856 | |z Get fulltext |u https://eprints.soton.ac.uk/359696/1/revolvertransactorsecondrevisionsent.pdf | ||
| 520 | |a In consumer lending the traditional approach is to develop a credit scorecard which ranks borrowers according to their risk of defaulting. Bads have a high risk of default and Goods have a low risk. To maximise the profitability of credit card customers, a second classification between revolvers and transactors becomes important. Building a transactor/revolver scorecard together with a Good/Bad scorecard over the revolvers, gives rise to a risk decision system whose ranking of risk is comparable with the standard approach. The paper develops a profitability model of card users including the transactor/revolver score leads. This gives more accurate profitability estimates than models which ignore the transactor/revolver split. | ||
| 540 | |a accepted_manuscript | ||
| 655 | 7 | |a Article | |