How MicroMoney's Algorithms Can Bring Down Minorities' Credit Score
Sai Hnin Aung, Founder of MicroMoney, talks about How MicroMoney's Algorithms Can Bring Down Minorities' Credit Score.
Sai Hnin Aung - Founder of MicroMoney
Your credit score is one of the most important numbers in your financial life. However, you may notice that your score varies depending on the reporting agency. To better understand credit scores, it is a good idea to understand some of the history behind them. Before standardized credit scores were used, most lenders came up with their own ways to score the risk that a borrower presented. The big problem was that this method didn't use a common set of calculations and rules to judge the potential risk of a borrower. The first credit scoring system was set up during the 1970s by the Fair Isaacs Company. The gold was to eliminate the inconsistencies that occurred when every lender did their own diagnostics on borrowers.
This score became well known as the FICO score. Today many lenders and the credit reporting agencies use this algorithm. However, credit scores can still vary between reporting agencies. Today, Equifax and Experian are top credit report agencies. When these agencies calculate your credit score, the score they generate is based upon their unique scoring model and the credit information they have received.
Each credit reporting agency wants their score to be seen as the best. And each credit reporting agency has a number of different credit scoring models they can use to evaluate your credit. The scoring model that most lenders use to evaluate potential borrowers, however, it is the FICO score. Your credit score can change your credit report changes. Your score is used to predict your overall health and credit worthiness. However, the same credit information is the basis for each score, meaning that no one's score is the best score. Even if your scores vary a little bit by credit reporting agency, there is no reason to be concerned.
Minority - owned businesses are growing at a faster pace than overall U.S. businesses. However, securing finances can be a challenge for minorities. According to the federal Minority Business Development Agency, minority entrepreneurs may have lower credit scores and fewer assets to secure loans than other business owners. The lenders do not have a minimum credit score requirement. Small business loans from banks offer the lowest interest rates, but there are financing opportunities for entrepreneurs who do not qualify for traditional lending. We have rounded up alternative financing options that may be a good fit.
MicroMoney is an Open Source Credit & Big Data Bureau that connects new customers to all existing financial services. MicroMoney A.I. platform uses complex algorithms to predict creditworthiness of all customers and in just 15 minutes a borrower can get their very first loan in their life just from their smartphone. Our technical experts have developed a unique scoring algorithm based on artificial intelligence and machine learning.
By now, a precise prediction about the borrower's trustworthiness is made based on around 10,000 parameters collected and analyzed by an algorithm. We improve the system to get more precise predictions. The scoring system uses machine learning, the more data we collect, the better predictions we obtain from it. Our system delivers a predictive score in accordance with the global FICO system. MicroMoney scoring algorithm is a self-learning system, the more loan we give out, the better its prediction works. Therefore, it significantly reduces the risk of loan non-repayment. With each new country launched, we gain access to huge data sets processed by our algorithm, improving it even more.
MicroMoney enables clients to build and secure their credit records for the future through a blockchain-based credit record database.
The 1st loan is disbursed through a domestic remittance or a bank account. The following loans are disbursed through domestic remittance, bank accounts, and payment systems. We are going to implement Everex's e-wallet in order to, provide our customers with loans in cryptocash. We require documents, applying online. Loan approval is based on our own scoring algorithm. MicroMoney will provide access to its data through an API platform. Our technical expert team is constantly improving the algorithm that processes information. Within several months the entire pool of existing credit records will be moved to the Blockchain.
Therefore, the safety and reliability of the collected information will be guaranteed.