Credit evaluation solutions for social groups with poor services in financial inclusion: A technical forecasting method

Lifeng Zhang, Xiangrui Chao, Qian Qian and Fuying Jing

Technological Forecasting and Social Change, 2022, vol. 183, issue C

Abstract: Financial inclusion aims to provide financial services at an affordable cost to low-income groups in need. However, the lack of effective credit evaluation information for such groups has hindered the innovative development of financial inclusion in the banking industry. This study proposes a slack constrained matrix factorisation model to supplement missing credit information. The method fills in missing data with known data in groups of similar credit behaviours. We empirically analyse the performance of this method in a supplemented credit information matrix and a sparse credit information matrix. We use actual credit data of farmers and herdsmen in extremely poor areas and small, medium and micro enterprises in National Equities Exchange and Quotations, China. This study concludes that the proposed credit evaluation methods based on sparse credit information can effectively improve the performance of traditional credit classification algorithms.

Keywords: Credit evaluation; Sparse credit information; Slack constrained matrix factorisation; Financial inclusion (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:tefoso:v:183:y:2022:i:c:s0040162522004255

DOI: 10.1016/j.techfore.2022.121902

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