A Credit Score System for Socially Responsible Lending

Begoña Gutiérrez-Nieto, Carlos Serrano-Cinca and Juan Camón-Cala
Additional contact information
Carlos Serrano-Cinca: Universidad de Zaragoza
Juan Camón-Cala: Universidad de Zaragoza

Journal of Business Ethics, 2016, vol. 133, issue 4, No 6, 701 pages

Abstract: Abstract Ethical banking, microfinance institutions or certain credit cooperatives, among others, grant socially responsible loans. This paper presents a credit score system for them. The model evaluates social and financial aspects of the borrower. The financial aspects are evaluated under the conventional banking framework, by analysing accounting statements and financial projections. The social aspects try to quantify the loan impact on the achievement of Millennium Development Goals such as employment, education, environment, health or community impact. The social credit score model should incorporate the lender’s know-how and should also be coherent with its mission. This is done using Multi-Criteria Decision Making (MCDM). The paper illustrates a real case: a loan application by a social entrepreneur presented to a socially responsible lender. The decision support system not only produces a score, but also reveals strengths and weaknesses of the application.

Keywords: Ethical banking; Social impact assessment; Credit scoring; Multi-criteria decision making (MCDM); Financial ratios (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
http://link.springer.com/10.1007/s10551-014-2448-5 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: A credit score system for socially responsible lending (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jbuset:v:133:y:2016:i:4:d:10.1007_s10551-014-2448-5

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10551/PS2

DOI: 10.1007/s10551-014-2448-5

Access Statistics for this article

Journal of Business Ethics is currently edited by Michelle Greenwood and R. Edward Freeman

More articles in Journal of Business Ethics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().