Euromoney: Non-traditional data aids trade credit scoring

A recent joint Trade Finance Global (TFG)/World Trade Organization (WTO) report raises questions over how to provide a more favourable framework for assessing credit risk through digital innovations, considering the new analytics that are available.
Many banks are already using new sources of data, for example enhancing standard credit file data with history of transactions and payments, and other behavioural data.

“The huge advantage of this data is that it comes from multiple sources not controlled by the borrower and thus is much harder to manipulate,” says Michael Boguslavsky, head of artificial intelligence (AI) at Tradeteq.

“Some of this data also changes at a much higher frequency than accounting data. The challenge is how to integrate it into the credit models.”

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