Hana Bank Develops Credit Scoring Model to Support Financially Marginalized Groups

[Asia Economy Reporter Kwangho Lee] Hana Bank announced on the 8th that it has developed a big data-based credit evaluation model utilizing transaction details from deposit and withdrawal accounts and will practice inclusive finance by supporting financially marginalized groups.

This model, developed independently by Hana Bank over approximately 10 months, uses big data-based machine learning and is designed especially for financially marginalized customers such as young adults entering society, housewives, and the elderly, who face difficulties in smooth credit assessment due to a lack of loan usage history and credit card usage records.

The model conducts credit evaluation by combining credit information provided by existing credit rating agencies with data that positively influence credit scores, such as transaction details from Hana Bank deposit and withdrawal accounts.

Based on more precise data, the bank can perform systematic risk management, and customers with limited financial transaction history are also given opportunities to benefit from better financial services through accurate credit evaluation, loan execution, and additional credit limit provision. Furthermore, existing customers will also be evaluated using this model, enabling more appropriate credit assessments.

Hwang Hyo-sang, Vice President of Hana Bank’s Risk Management Group, said, "With the recently initiated risk management technique using pseudonymized information, transaction details from bank accounts can now be utilized in the credit evaluation model." He added, "Going forward, Hana Bank will continue to strive to provide various solutions to grow together with financially marginalized groups as the nation’s top-level risk management specialized bank."

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