Alternative Credit Rating

Pulse

The “Pulse” is an alternative credit rating algorithm that can innovatively complement the traditional credit evaluation framework.
Even without financial information, the system can provide accurate and real-time assessments of the SME credit risk by collecting a myriad of open (public) data, generating RFM variables, and implementing multidimensional analysis.

Mechanism

RFM Processing

The “Pulse” system collects more than 300 data points for a single company and processes each data in terms of RFM (Recency, Frequency, and Magnitude) by analyzing the data generation log.

Significant Variable Selection

The system examines the correlation between the individual processed data and company default risk by executing an array of statistical tests (t-test, chi-square test, ANOVA, etc.) and defines the final variables according to the results.

Alternative Credit Rating

The algorithm scores individual companies based on the risk predictions derived from the RFM pattern. The system assigns each company to risk level categorizes and transmits information to financial institutions.