| Author | Pradhan, Kritika |
| Note | A project submitted in partial fulfillment of the requirements for the degree of Professional Masters in Banking and Finance |
| Publisher | Asian Institute of Technology |
| Abstract | In our organization, the credit risk assessment approach is undifferentiated for all loans regardless of the scale of risk. Keeping in mind the completely different requirement of the SMEs, it’s felt that an independent credit-scoring model for SMEs would be necessary in order to make credit more accessible to the SMEs and also for the bank to appraise the SME loans efficiently.
To facilitate the miscellaneous overdraft facility renewal for SMEs, to reduce importance of collaterals and also to avoid unworthy MO account renewals, two internal credit-scoring models has been developed.
It is found that the internal credit scoring model containing both quantitative and qualitative parameters works perfectly for the regular MO accounts but it does not work accurately for the accounts which are about to become NPAs. This is found to be mainly due to the inaccurate business data submitted to the bank during the renewal of the MO accounts.
Therefore, to make internal credit scoring effective and efficient, it’s recommended that the bank officials be trained to check the consistency of the business data and additional data be sought from the clients. Otherwise, meantime the second credit-scoring model with more weightage to the qualitative variable can be implement. |
| Year | 2013 |
| Type | Project |
| School | School of Management (SOM) |
| Department | Other Field of Studies (No Department) |
| Academic Program/FoS | Professional Master in Corporate Social Responsibility (SM) |
| Chairperson(s) | Venkatesh, Sundar; |
| Examination Committee(s) | Wijewardena, Weerakoon A.;Badir, Yuosre ; |
| Scholarship Donor(s) | Bank of Bhutan, Ltd.; |