NDLI: Concept of a decision support system for a loan granting based on continuous price function

Content Provider	IEEE Xplore Digital Library
Author	Romanyuk, K.
Copyright Year	2015
Description	Author affiliation: Dept. of Inf. Syst. in Econ. & Manage., Peter the Great St.-Petersburg Polytech. Univ., St. Petersburg, Russia (Romanyuk, K.)
Abstract	Loan provision is associated with a credit risk. Banks assess the creditworthiness of potential borrowers to lower a credit risk. Creditworthiness assessment is carried out by credit scoring methods. Most of these methods classify individuals into two categories: `good' or `bad' creditworthiness. Decision support system for loan granting based on these methods fail to differentiate the loan price for private borrowers. In practice, banks mostly grant loans applying decision support system that makes no price differentiation for individuals according to their private information. A bank may differentiate a loan price to attract a specific group of borrowers. In this paper, loan price differentiation impact on the behaviour of banks potential borrowers in the market for consumer lending is analyzed. A concept of a decision support system for loan granting based on the use of a continuous loan price function of the borrower's creditworthiness rating is proposed. Competition between banks using different loan price function of creditworthiness rating is analyzed. Borrowers with a low credit risk are interested in switching to a bank that reflects more private information in a loan price. Application of the proposed system provides a competitive advantage for a bank to attract borrowers with a low credit risk. It is shown that fuzzy logic has a potential to be applied in a decision support system based on continuous price function for granting a credit.
Starting Page	105
Ending Page	111
File Size	340473
Page Count	7
File Format	PDF
e-ISBN	9781467376068
DOI	10.1109/IntelliSys.2015.7361092
Language	English
Publisher	Institute of Electrical and Electronics Engineers, Inc. (IEEE)
Publisher Date	2015-11-10
Publisher Place	UK
Access Restriction	Subscribed
Rights Holder	Institute of Electrical and Electronics Engineers, Inc. (IEEE)
Subject Keyword	Decision support systems Economics Loan Granting Switches Continuous Classification Scale Decision Support System Information systems Fuzzy logic Credit Scoring Creditworthiness Values Reliability Intelligent systems Fuzzy Logic
Content Type	Text
Resource Type	Article

Sl.	Authority	Responsibilities	Communication Details
1	Ministry of Education (GoI), Department of Higher Education	Sanctioning Authority	https://www.education.gov.in/ict-initiatives
2	Indian Institute of Technology Kharagpur	Host Institute of the Project: The host institute of the project is responsible for providing infrastructure support and hosting the project	https://www.iitkgp.ac.in
3	National Digital Library of India Office, Indian Institute of Technology Kharagpur	The administrative and infrastructural headquarters of the project	Dr. B. Sutradhar bsutra@ndl.gov.in
4	Project PI / Joint PI	Principal Investigator and Joint Principal Investigators of the project	Dr. B. Sutradhar bsutra@ndl.gov.in Prof. Saswat Chakrabarti will be added soon
5	Website/Portal (Helpdesk)	Queries regarding NDLI and its services	support@ndl.gov.in
6	Contents and Copyright Issues	Queries related to content curation and copyright issues	content@ndl.gov.in
7	National Digital Library of India Club (NDLI Club)	Queries related to NDLI Club formation, support, user awareness program, seminar/symposium, collaboration, social media, promotion, and outreach	clubsupport@ndl.gov.in
8	Digital Preservation Centre (DPC)	Assistance with digitizing and archiving copyright-free printed books	dpc@ndl.gov.in
9	IDR Setup or Support	Queries related to establishment and support of Institutional Digital Repository (IDR) and IDR workshops	idr@ndl.gov.in

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