Credit risk is associated with the possibility of a client failing to meet contractual obligations, such as mortgages, credit card debts, and other types of loans.

Minimizing the risk of default is a major concern for financial institutions. For this reason, commercial and investment banks, venture capital funds, asset management companies and insurance firms, to name a few, are increasingly relying on technology to predict which clients are more prone to stop honoring their debts.

Machine Learning models have been helping these companies to improve the accuracy of their credit risk analysis, providing a scientific method to identify potential debtors in advance.

In this article, we will build a model to predict the risk of client default for Nubank, a prominent Brazilian Fintech.

#credit-risk #data-science #data-analysis #machine-learning