Judgmental vs. Statistical Scorecard
If you have no historical data you can create judgmental scorecard
by selecting customer’s characteristics and corresponding weights
based on experts opinion.
After several months, when you will have historical data about
delinquencies, you can gradually switch from judgment to
statistical scorecard.
Comparison of judgmental
and statistical approach for loan applicant evaluation
Characteristics
Judgement
Credit Scoring
Payment to Income Ratio
+
112
Marital Status
+
37
Last Work Record
+
105
Children
+
62
Cards
-
0
Credit History
+
262
Home Ownership
+
35
Time At Branch
+
45
Overall
+
658
Accept
Accept
unknown
"24:1"
Decision
Odds of repayment
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