Credit scoring improves borrower selection, Bank of Italy paper says
Paper presents database on loans and use of credit-scoring models
The use of credit scoring by commercial banks decreases the risk of borrowers defaulting on loans, a working paper published by the Bank of Italy argues.
In Does credit scoring improve the selection of borrowers and credit quality?, Giorgio Albareto, Roberto Felici and Enrico Sette present a novel database on loans and credit scoring in Italy. It combines data on loans to small firms from the Bank of Italy's credit register with survey data tracking the use of credit-scoring models by Italian
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