Credit Scoring Models and Bundled Transactions Get Industry’s Latest Attention
Posted 01/29/09
Two new studies, funded by the Foundation, are currently in the field, including “How Good is Your Credit Scoring Model?” and “Bundled Transaction Frameworks” (both working titles).
The credit scoring model paper will identify the specific risks associated with the application of credit scoring models to credit decisioning. An overview of exiting practices in the equipment finance industry, as well as practices that vary significantly from the norm, will be included. Recommendations for future courses of action will provide readers with options to improve model accuracy and reduce inherent risk exposure due to model deterioration. In addition to the paper, a Journal of Equipment Financing article will summarize key points.
The credit scoring model paper will identify the specific risks associated with the application of credit scoring models to credit decisioning. An overview of exiting practices in the equipment finance industry, as well as practices that vary significantly from the norm, will be included. Recommendations for future courses of action will provide readers with options to improve model accuracy and reduce inherent risk exposure due to model deterioration. In addition to the paper, a Journal of Equipment Financing article will summarize key points.The credit scoring paper is being researched by PredictiveMetrics.
Also in the field is a study examining the critical question around whether or not bundled transactions frameworks will persist as a procurement option on the “IT acquisition spectrum.” This research paper will address whether equipment financing customers will continue to choose these financial structures, leading vendors to continue to offer them. Being researched by Accenture Research, the authors will provide a point of view as to the future potential of these financing structures in the U.S. market.
Both papers are expected to be available in this spring. Once available, interested parties may download a copy of the papers from the Foundation store at http://www.store.leasefoundation.org/
Donors receive Foundation research at no charge; non donors may download white papers and studies for a fee. Check the Foundation web site often for new project availability.
