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Inclusion of peer group and individual low-income earners in M-Shwari micro-credit lending: a hidden Markov model approach

Inclusion of peer group and individual low-income earners in M-Shwari micro-credit lending: a... The M-Shwari micro-credit lending system has excluded the low income earners as they lack good financial options due to volatile and fluctuating income. This paper proposes a decision support system for credit scoring and lending of the low income earners who are customers of M-Shwari using the hidden Markov model. The model emits the credit scores of the customers, both for the peer groups and the individual customers. The learning and training of the model utilises the customers' socio-demographics, telecommunication characteristics and account activities. The peer groups have higher credit scores and are more attractive to offer credit facilities using M-Shwari when compared to the individual borrowers. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Electronic Finance Inderscience Publishers

Inclusion of peer group and individual low-income earners in M-Shwari micro-credit lending: a hidden Markov model approach

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Publisher
Inderscience Publishers
Copyright
Copyright © Inderscience Enterprises Ltd
ISSN
1746-0069
eISSN
1746-0077
DOI
10.1504/IJEF.2018.092195
Publisher site
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Abstract

The M-Shwari micro-credit lending system has excluded the low income earners as they lack good financial options due to volatile and fluctuating income. This paper proposes a decision support system for credit scoring and lending of the low income earners who are customers of M-Shwari using the hidden Markov model. The model emits the credit scores of the customers, both for the peer groups and the individual customers. The learning and training of the model utilises the customers' socio-demographics, telecommunication characteristics and account activities. The peer groups have higher credit scores and are more attractive to offer credit facilities using M-Shwari when compared to the individual borrowers.

Journal

International Journal of Electronic Finance – Inderscience Publishers

Published: Jan 1, 2018

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