KakaoBank Wins Grand Prize at the '2021 Pseudonymized Data Utilization Best Practice Competition'

[Asia Economy Reporter Kiho Sung] KakaoBank announced on the 19th that it won the grand prize at the '2021 Pseudonymized Information Utilization Best Practices Competition,' jointly held by the Personal Information Protection Commission, Ministry of Science and ICT, Financial Services Commission, and Ministry of Health and Welfare, for its development case of a credit evaluation model for mid-credit and thin-file customers (those with insufficient financial history) through data pseudonymized linkage.

Pseudonymized information refers to data in which part of personal information is deleted or replaced so that a specific individual cannot be identified without combining it with additional information. This competition was held for the first time this year to discover best practices and ideas for utilizing pseudonymized information and to enhance the safe use of such data.

KakaoBank presented a case of developing an advanced credit evaluation model using data pseudonymized linkage and machine learning for mid-to-low credit and thin-file customers, for whom precise evaluation is difficult with credit evaluation models focused on financial information. KakaoBank has been applying this model to actual loan screening since June this year.

Kyungtae Ha, head of KakaoBank's Credit Risk Modeling Team, said, "We plan to continuously improve the model's discriminative power by additionally pseudonymously linking alternative information such as individual business owners' sales data, simple payment and remittance information, and public information like year-end tax settlement." He added, "Based on KakaoBank's unique credit evaluation model, we will take the lead in financial inclusion for mid-to-low credit customers."

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