scholarly journals Use of Machine Learning Techniques to Create a Credit Score Model for Airtime Loans

2020 ◽  
Vol 13 (8) ◽  
pp. 180 ◽  
Author(s):  
Bernard Dushimimana ◽  
Yvonne Wambui ◽  
Timothy Lubega ◽  
Patrick E. McSharry

Airtime lending default rates are typically lower than those experienced by banks and microfinance institutions (MFIs) but are likely to grow as the service is offered more widely. In this paper, credit scoring techniques are reviewed, and that knowledge is built upon to create an appropriate machine learning model for airtime lending. Over three million loans belonging to more than 41 thousand customers with a repayment period of three months are analysed. Logistic Regression, Decision Trees and Random Forest are evaluated for their ability to classify defaulters using several cross-validation approaches and the latter model performed best. When the default rate is below 2%, it is better to offer everyone a loan. For higher default rates, the model substantially enhances profitability. The model quadruples the tolerable level of default rate for breaking even from 8% to 32%. Nonlinear classification models offer considerable potential for credit scoring, coping with higher levels of default and therefore allowing for larger volumes of customers.

2022 ◽  
pp. 220-249
Author(s):  
Md Ariful Haque ◽  
Sachin Shetty

Financial sectors are lucrative cyber-attack targets because of their immediate financial gain. As a result, financial institutions face challenges in developing systems that can automatically identify security breaches and separate fraudulent transactions from legitimate transactions. Today, organizations widely use machine learning techniques to identify any fraudulent behavior in customers' transactions. However, machine learning techniques are often challenging because of financial institutions' confidentiality policy, leading to not sharing the customer transaction data. This chapter discusses some crucial challenges of handling cybersecurity and fraud in the financial industry and building machine learning-based models to address those challenges. The authors utilize an open-source e-commerce transaction dataset to illustrate the forensic processes by creating a machine learning model to classify fraudulent transactions. Overall, the chapter focuses on how the machine learning models can help detect and prevent fraudulent activities in the financial sector in the age of cybersecurity.


2020 ◽  
Vol 9 (6) ◽  
pp. 379 ◽  
Author(s):  
Eleonora Grilli ◽  
Fabio Remondino

The use of machine learning techniques for point cloud classification has been investigated extensively in the last decade in the geospatial community, while in the cultural heritage field it has only recently started to be explored. The high complexity and heterogeneity of 3D heritage data, the diversity of the possible scenarios, and the different classification purposes that each case study might present, makes it difficult to realise a large training dataset for learning purposes. An important practical issue that has not been explored yet, is the application of a single machine learning model across large and different architectural datasets. This paper tackles this issue presenting a methodology able to successfully generalise to unseen scenarios a random forest model trained on a specific dataset. This is achieved looking for the best features suitable to identify the classes of interest (e.g., wall, windows, roof and columns).


2021 ◽  
Vol 2021 ◽  
pp. 1-10
Author(s):  
Choudhary Sobhan Shakeel ◽  
Saad Jawaid Khan ◽  
Beenish Chaudhry ◽  
Syeda Fatima Aijaz ◽  
Umer Hassan

Alopecia areata is defined as an autoimmune disorder that results in hair loss. The latest worldwide statistics have exhibited that alopecia areata has a prevalence of 1 in 1000 and has an incidence of 2%. Machine learning techniques have demonstrated potential in different areas of dermatology and may play a significant role in classifying alopecia areata for better prediction and diagnosis. We propose a framework pertaining to the classification of healthy hairs and alopecia areata. We used 200 images of healthy hairs from the Figaro1k dataset and 68 hair images of alopecia areata from the Dermnet dataset to undergo image preprocessing including enhancement and segmentation. This was followed by feature extraction including texture, shape, and color. Two classification techniques, i.e., support vector machine (SVM) and k -nearest neighbor (KNN), are then applied to train a machine learning model with 70% of the images. The remaining image set was used for the testing phase. With a 10-fold cross-validation, the reported accuracies of SVM and KNN are 91.4% and 88.9%, respectively. Paired sample T -test showed significant differences between the two accuracies with a p < 0.001 . SVM generated higher accuracy (91.4%) as compared to KNN (88.9%). The findings of our study demonstrate potential for better prediction in the field of dermatology.


2020 ◽  
Vol 16 (1) ◽  
Author(s):  
Madapuri Rudra Kumar ◽  
Vinit Kumar Gunjan

Introduction:Increase in computing power and the deeper usage of the robust computing systems in the financial system is propelling the business growth, improving the operational efficiency of the financial institutions, and increasing the effectiveness of the transaction processing solutions used by the organizations. Problem:Despite that the financial institutions are relying on the credit scoring patterns for analyzing the credit worthiness of the clients, still there are many factors that are imminent for improvement in the credit score evaluation patterns.  Objective:Machine learning is offering immense potential in Fintech space and determining a personal credit score. Organizations by applying deep learning and machine learning techniques can tap individuals who are not being serviced by traditional financial institutions. Methodology:One of the major insights into the system is that the traditional models of banking intelligence solutions are predominantly the programmed models that can align with the information and banking systems that are used by the banks. But in the case of the machine-learning models that rely on algorithmic systems require more integral computation which is intrinsic.  Results:The test analysis of the proposed machine learning model indicates effective and enhanced analysis process compared to the non-machine learning solutions. The model in terms of using various classifiers indicate potential ways in which the solution can be significant. Conclusion: If the systems can be developed to align with more pragmatic terms for analysis, it can help in improving the process conditions of customer profile analysis, wherein the process models have to be developed for comprehensive analysis and the ones that can make a sustainable solution for the credit system management. Originality:The proposed solution is effective and the one conceptualized to improve the credit scoring system patterns.  Limitations: The model is tested in isolation and not in comparison to any of the existing credit scoring patterns. 


2021 ◽  
Vol 8 (1) ◽  
Author(s):  
Chalachew Muluken Liyew ◽  
Haileyesus Amsaya Melese

AbstractPredicting the amount of daily rainfall improves agricultural productivity and secures food and water supply to keep citizens healthy. To predict rainfall, several types of research have been conducted using data mining and machine learning techniques of different countries’ environmental datasets. An erratic rainfall distribution in the country affects the agriculture on which the economy of the country depends on. Wise use of rainfall water should be planned and practiced in the country to minimize the problem of the drought and flood occurred in the country. The main objective of this study is to identify the relevant atmospheric features that cause rainfall and predict the intensity of daily rainfall using machine learning techniques. The Pearson correlation technique was used to select relevant environmental variables which were used as an input for the machine learning model. The dataset was collected from the local meteorological office at Bahir Dar City, Ethiopia to measure the performance of three machine learning techniques (Multivariate Linear Regression, Random Forest, and Extreme Gradient Boost). Root mean squared error and Mean absolute Error methods were used to measure the performance of the machine learning model. The result of the study revealed that the Extreme Gradient Boosting machine learning algorithm performed better than others.


Analysis of patient’s data is always a great idea to get accurate results on using classifiers. A combination of classifiers would give an accurate result than using a single classifier because one single classifier does not give accurate results but always appropriate ones. The aim is to predict the outcome feature of the data set. The “outcome” can contain only two values that is 0 and 1. 0 means patient doesn’t have heart disease and 1 means patient have heart diseases. So, there is a need to build a classification algorithm that can predict the Outcome feature of the test dataset with good accuracy. For this understanding the data is important, and then various classification algorithm can be tested. Then the best model can be selected which gives highest accuracy among all. The built model can then be given to the software developer for building the end user application using the selected machine learning model that will be able to predict the heart disease in a patient.


Personality has been important for a number of types of cooperation; it has useful in predicting job achievement, expert and emotional relationship achievement, and even tendency towards a variety of interfaces. To accurately examine the characters of users, a personality test must be carried out. In numerous areas of online life it is usually impractical to use character research. . We used SVM classification, Random Forest algorithm, Naïve Bayes Algorithm and Logistic regression to comparatively predict the user’s personality accurately. The main goal of the paper is to evaluate the machine learning models using the four parameters- accuracy, precision, recall, f1 score and basing upon these parameters the best machine learning model will be used to classify the big five personality traits of the twitter users.


2021 ◽  
Vol 14 (11) ◽  
pp. 516
Author(s):  
Dean Fantazzini ◽  
Raffaella Calabrese

While there is increasing interest in crypto assets, the credit risk of these exchanges is still relatively unexplored. To fill this gap, we considered a unique dataset of 144 exchanges, active from the first quarter of 2018 to the first quarter of 2021. We analyzed the determinants surrounding the decision to close an exchange using credit scoring and machine learning techniques. Cybersecurity grades, having a public developer team, the age of the exchange, and the number of available traded cryptocurrencies are the main significant covariates across different model specifications. Both in-sample and out-of-sample analyzes confirm these findings. These results are robust in regard to the inclusion of additional variables, considering the country of registration of these exchanges and whether they are centralized or decentralized.


2022 ◽  
Vol 2022 ◽  
pp. 1-13
Author(s):  
Rajkumar Gangappa Nadakinamani ◽  
A. Reyana ◽  
Sandeep Kautish ◽  
A. S. Vibith ◽  
Yogita Gupta ◽  
...  

Cardiovascular disease is difficult to detect due to several risk factors, including high blood pressure, cholesterol, and an abnormal pulse rate. Accurate decision-making and optimal treatment are required to address cardiac risk. As machine learning technology advances, the healthcare industry’s clinical practice is likely to change. As a result, researchers and clinicians must recognize the importance of machine learning techniques. The main objective of this research is to recommend a machine learning-based cardiovascular disease prediction system that is highly accurate. In contrast, modern machine learning algorithms such as REP Tree, M5P Tree, Random Tree, Linear Regression, Naive Bayes, J48, and JRIP are used to classify popular cardiovascular datasets. The proposed CDPS’s performance was evaluated using a variety of metrics to identify the best suitable machine learning model. When it came to predicting cardiovascular disease patients, the Random Tree model performed admirably, with the highest accuracy of 100%, the lowest MAE of 0.0011, the lowest RMSE of 0.0231, and the fastest prediction time of 0.01 seconds.


2020 ◽  
Vol 34 (20) ◽  
pp. 2050196
Author(s):  
Haozhen Situ ◽  
Zhimin He

Machine learning techniques can help to represent and solve quantum systems. Learning measurement outcome distribution of quantum ansatz is useful for characterization of near-term quantum computing devices. In this work, we use the popular unsupervised machine learning model, variational autoencoder (VAE), to reconstruct the measurement outcome distribution of quantum ansatz. The number of parameters in the VAE are compared with the number of measurement outcomes. The numerical results show that VAE can efficiently learn the measurement outcome distribution with few parameters. The influence of entanglement on the task is also revealed.


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