Comprehensive Audit of The Criteria Used For Scoring Applicants For Consumer Credit

Abstract

This paper presents a comprehensive audit of the criteria used for scoring applicants for consumer credit. The audit consists of two parts: the first part focuses on the criteria used in customized models, while the second part deals with those used in Fair-Isaac and Co (FICO) or generic models. This paper shows that most of the sets of criteria variables used in lending institutions and in literature are poorly selected and poorly defined

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