Cumulative event rates
Shows the dependence between changes in rates
of “Good” and “Bad” and changes in the score
Acceptable Cumulative Event Rates graph
An increase in the share of the “Good” outcomes,
accompanied by a decrease in the number of “Bad”
accounts, confirms that the Scorecard’s performance is
logical.
A monotonous decrease in the share of the “Bad”
borrowers in the upper score range speaks about the
correctness of the Scorecard’s performance and its ability
to differentiate “Bad” borrowers into the lower part of the
working range.
“Bads” situated in the part of
the population with low scores
“Goods” appears in the part of
the population with high scores
Unacceptable Cumulative Event Rates graph
Intersection of the curves
should be closer to the left
of the graph
Curve should be smooth but it
has drop downs on the chart
area with the highest risk
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