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Problem Statement1

This document presents a problem statement for predicting credit card customer default. The objective is to use variables from credit accounts, purchases, and delinquency history to model the probability of whether a customer will pay their credit card bill or not. Predicting default (PD) is important for credit companies to understand customer risk levels and how much credit may be lost if a customer defaults. The data dictionary on Sheet 2 provides metadata for modeling the probability of default using the provided customer dataset.

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stephennrobert
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268 views1 page

Problem Statement1

This document presents a problem statement for predicting credit card customer default. The objective is to use variables from credit accounts, purchases, and delinquency history to model the probability of whether a customer will pay their credit card bill or not. Predicting default (PD) is important for credit companies to understand customer risk levels and how much credit may be lost if a customer defaults. The data dictionary on Sheet 2 provides metadata for modeling the probability of default using the provided customer dataset.

Uploaded by

stephennrobert
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Problem statement:

This business problem is a supervised learning example for a credit card company. The objective is to
predict the probability of default (whether the customer will pay the credit card bill or not) based on the
variables provided. There are multiple variables on the credit card account, purchase and delinquency
information which can be used in the modelling.

PD modelling problems are meant for understanding the riskiness of the customers and how much credit is
at stake in case the customer defaults. This is an extremely critical part in any organization that lends money
[both secured and unsecured loans].

Refer to the Sheet 2 of the PD_modelling_dataset for the Data Dictionary.

Proprietary content. ©Great Learning. All Rights Reserved. Unauthorized use or distribution prohibited.

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