A Decision Model for Group Assessment of Credit Applications

Abstract

This paper proposes a group decision model for the assessment of credit/loan applications by a team. As many new players enter the finance sector, offering new products and different forms of financing, it is important that credit applications are assessed from multiple angles including the marketing and risk management sides. While external organisations offer independent ratings and credit reports of potential applicants, lending firms need to take into account internal criteria in order to effectively allocate and grant credit to their customers. Individual products target specific customer profiles:in this paper we propose a tool to support the multicriteria assessment and classification of the applicants' profile aiming for a good match between the product and the customer. This will look at expanding the firm's customer base with a reduced risk of bad credit.