Credit EDA Assignment PDF
Credit EDA Assignment PDF
BY PANKAJ KUMAR
Problem Statement I
The loan providing companies find it hard to give loans to the people
due to their insufficient or non-existent credit history. Because of that,
some consumers use it as their advantage by becoming a defaulter.
Suppose you work for a consumer finance company which specialises
in lending various types of loans to urban customers. You have to use
EDA to analyse the patterns present in the data. This will ensure that the
applicants capable of repaying the loan are not rejected.
When the company receives a loan application, the company has to
decide for loan approval based on the applicant’s profile. Two types of
risks are associated with the bank’s decision:
If the applicant is likely to repay the loan, then not approving the loan
results in a loss of business to the company
If the applicant is not likely to repay the loan, i.e. he/she is likely to
default, then approving the loan may lead to a financial loss for the
company.
Problem Statement - II