Accelerating and Automating Small Business Lending

Loans issued in days rather than weeks while bad debts reduced to 3 percent of loan book

Malaysia’s Credit Guarantee Corporation (CGC), a government and commercial enterprise joint venture, has used FICO’s decision management technology to improve its ability to judge the creditworthiness of small businesses so it can provide them with loans.

This direct lending is an expansion of CGC’s usual role of providing loan guarantees to businesses, many of which lack the collateral and track record to obtain regular financing. Since its deployment of FICO^® Blaze Advisor^® decision rules management system and custom analytic models in August 2016, CGC has reduced non-performing loans to just 3 percent of the loan book and has had only one default.

For its achievements, CGC has won the 2017 FICO Decisions Award for Decision Management Innovation. The winners of the FICO Decisions Awards were spotlighted at FICO World 2018, the Decisions Conference, April 16-19 in Miami Beach, Florida.

"The decision management automation provided by FICO has been a leap forward for our business,” said Perbagaran a/l K. Kuppusamy, chief risk officer at CGC. “Previously we were requesting bureau and demographic data, receiving it in a physical format and then aggregating it so that our risk team could assess the data based on bureau rules and determine eligibility for particular schemes. With FICO Blaze Advisor and FICO analytics, this time-consuming and tedious process has been cut from weeks to two or three days, and we have a more accurate risk assessment of each customer.”

“The complexity of the solution Credit Guarantee Corporation built and deployed made it stand out among this year’s FICO Decisions Awards contestants,” said Daniel Mayo, chief analyst for financial services technology at Ovum, one of this year’s FICO Decisions Awards judges. “CGC’s ability to play a developmental role in supporting the country’s economic development agenda can only be enhanced by this project.”

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