Credit risk estimation using payment history data: a comparative study of Turkish retail stores


KARAN M. B. , ULUCAN A. , KAYA M.

CENTRAL EUROPEAN JOURNAL OF OPERATIONS RESEARCH, cilt.21, ss.479-494, 2013 (SCI İndekslerine Giren Dergi) identifier identifier

  • Cilt numarası: 21 Konu: 2
  • Basım Tarihi: 2013
  • Doi Numarası: 10.1007/s10100-012-0242-y
  • Dergi Adı: CENTRAL EUROPEAN JOURNAL OF OPERATIONS RESEARCH
  • Sayfa Sayıları: ss.479-494

Özet

Our paper presents a comparative study applying logistic regression and multiple criteria decision analysis tools to the operations of wholesalers to assess the credit risk of their retailers using payment history data and to cluster the risky customers by ranking their risk levels. Our sample comprises approximately 6,000 retailer customers and 600.000 transactions of one of the major wholesalers of Turkey. Our findings emphasize the importance of using payment history and some non-financial factors data for predicting the creditworthiness of a firm.