Credit Assessment Methodology

The objective of the credit appraisal process is to evaluate the borrower’s repayment capacity on a wide range of parameters detailed below. These parameters enable us to ascertain the key pillars of credit namely ability, intention, collectability.

The below are broad parameters of the methodology for credit evaluation

Primary Eligibility Criteria

  • 1. Minimum age of applicant: 18 years.
  • 2. Maximum age of applicant at loan maturity: 65 years.
  • 3. Employment: Salaried and Self Employed with monthly income of INR 18,000.
  • 4. CIBIL : NTC and Min Score 650.

 

KYC Check / Document Validation

  • 1. Proof of Identity.
  • 2. Proof of Address.
  • 3. Income Documents and Bank Statement, as applicable.
  • 4. Any other document as requested at the time of credit appraisal.

 

Credit Decisioning & Evaluation

An in-depth analysis is done to evaluate the credit worthiness for all the applications. Based on Liquiloans’ (NDX P2P Private Limited) proprietary in-house algorithm and underwriting, credit decisions are made based on the below parameters :

  • 1. Personal and Demographic profile.
  • 2. Family profile.
  • 3. Employment and Income Profiling.
  • 4. CIBIL Behavior and Repayment History.
  • 5. Analysis of tradelines in CIBIL.
  • 6. Banking Behavior.
  • 7. Financial Parameters : FOIR, Leverage Levels, Loan to Income Ratios, etc.
  • 8. Using LL Risk Score to categorize borrowers.
  • Risk Score Bureau Monthly Income FOIR#
    1 Above 725 Income >= 50K FOIR <= 80
    2 Above 725 Income >= 30K and < 50K FOIR <= 80
    3 Above 725 Income >= 10K and < 30K FOIR <= 80
    4 Above 725 Income >= 10K FOIR > 80
    5 651 to 775 OR NTC* Income >= 30K FOIR <= 80
    6 651 to 775 OR NTC Income >= 10K and < 30K FOIR <= 80
    7 651 to 775 OR NTC Income >= 10K FOIR > 80
    8 551 to 650 Income >= 30K FOIR <= 80
    9 551 to 650 Income >= 10K and < 30K FOIR <= 80
    10 551 to 650 Income >= 10K FOIR > 80
    NTC = New To Credit (Bureau < 220)
    #FOIR = Fixed Obligations to Income Ratio
  • 9. Tele verification / physical verification.