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Credit risk modeling platforms: One-size fits…nobody

//Credit risk modeling platforms: One-size fits…nobody

BeeEye Blog

Credit risk modeling platforms: One-size fits...nobody

Credit risk modeling platforms: One-size fits...nobody

No one knows for sure exactly when the first “one size” clothing garment was manufactured. But it seems that despite the longevity of this fashion phenomenon, no one has ever made a one-size-fits-all garment that fits even most of its target customers. The situation is similar when it comes to SaaS, and specifically risk management modeling platforms. Here are five reasons why a solution that is tailored to your business, especially if you’re a bank or a credit lender, is the right choice. 

The benefits of an industry-specific credit risk modeling platform

Industry features

When a tool is designed for a specific industry, it’s designed with specific users in mind. Its creators consider their users’ internal processes, KPIs, the common problems they encounter and the steps they take to resolve them. For example, an automatic feature generator to help you improve your model’s predictions will likely not be found in a generic machine learning based modeling platform. Another often overlooked issue with generic solutions is the complex integration to external sources. When a platform is designed for your business, it will easily integrate to the relevant data sources, saving you time and effort in the process.

Industry processes and regulations

For highly regulated industries like credit management, internal processes and regulations are highly specific. When a tool is designed with your process in mind, it addresses your specific challenges, and helps you solve them. If you’re a lender, this might mean the ability to auto-track the model’s papertrail, which makes it easier to track changes in the model, increases its explainability, and supports compliance. This solves the “black box” problem that’s forbidden in the credit management industry, and will be overlooked in a generic platform

No bells and whistles

Machine learning based platforms can have a lot of features that are completely irrelevant to you. This might crowd the design (UX) and interfere with users’ ability to focus on the features they need. A platform that is solely designed for your purpose will have a simple, elegant and useful design that jives with the way you work. Exactly what you need, from the most simple transformation to complex time series, but nothing more.

One tool to rule them all

Generally speaking, the task of creating a predictive model is just one step in a larger process. An industry specific platform delivers the entire solution and not just the “engine”. Why does it matter? Because it affects your bottom line. You need only one tool instead of a toolchain, which saves you time and money. It also saves you the need to integrate a standalone “engine” with multiple tools. Your own domain analysts can work with the platform, which means a smaller team that doesn’t rely on external, broad data science skills.

Industry evolution

When the market, your competitors or your regulations change, you want your platform to adjust accordingly. True, most credit-risk specific platforms have long update cycles, so your challenge here is double: You need to find a platform that not only advances with your industry, but also has the ability to update quickly. Look for industry specific, highly automated one to make the most of the platform’s industry focus. 

These principles are true for many other SaaS solutions in different domains, but are especially true in the highly complex, regulated credit industry. If you’re looking for a credit risk modeling platform that was designed for your industry, with your day to day and business goals in mind, check out BeeEye’s EyeOnRisk platform here

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