A Research On Modeling And Application Of Risk Assessment For Online Pettyloan In Bank A

In recent years,with the rapid development of the economy,people’s consumption concepts have also changed.They are more and more inclined to apply for loans from banks to consume in advance,which has promoted the development of petty loan business.The petty loan business has typical characteristics such as its small scale which can be applied online.Therefore,how to determine whether the applicant can repay the loan as agreed as well as to ensure the profit of the banks has become the center of attention.The credit risk assessment can be used as a tool to identify the bad from the good which can be used by banks to decide whether to grant credit to the applicant or not.This study constructed a risk assessment suitable for Bank A’s products and designed its management mechanism.This study uses the Logistic Regression algorithm as the method to find the bad from the good for Bank A.In General,the risk assessment have three parts which include Application Score Card(referred to as A Card),Behavior Score Card(referred to as B Card)and Collection Score Card(referred to as C Card).In our research,we aimed at A card.In order to construct a risk assessment for the Bank A,100,000 pieces of data provided by the partner and the Bank A are used as the data set for training and testing.After training,the result of this risk assessment is verified and evaluated in terms of stability and differentiation.Our study describes in detail on how to building a risk assessment for Bank A’s petty loan business.The study results show that the risk assessment has good discrimination and stability which meets the national requirements.This set of risk assessment model and its management mechanism have been applied in the daily business of bank A.After launched,the indicators of bad debt rate and non-performing rate remained at a low level,which verified the effectiveness of this risk assessment to some extent.The improvement of its management mechanism has made the coordination among various departments smoother.So the speed of business operation has been greatly improved.It can better respond to the changing market environment which leads the improvement of overall risk control system of Bank A.