FinBox DeviceConnect

Case Competition
Acquaint yourself with the practical applications of FinTech
Business and explore the world of Alternate Data based
financing!

Delve Deep into sea of data to generate data driven loan

underwriting engine, create customer segmentation and
design product positioning strategies!
 FinBox – Company and Product Overview

FinBox democratizes technology for FinTechs and Enterprises so that they

can build financial services and products for the next billion Indians.

One of the products developed by FinBox to achieve this, FinBox

DeviceConnect SDK, generates alternate data to assess customers credit
worthiness in real time and enable approval decisions for their loan
applications.

Device Data serves as a rich source to holistically profile a customer’s

financial needs, monetary health, transactional behaviour and fraud
propensity, which helps the financial institutions to serve customers with
low risk and highly efficient CRM processes, further driving financial
inclusion for first time loan takers and SMEs.
 DeviceConnect Tech Architecture

• On customer’s consent, real time data is gathered from customer’s hand held device.

• The unstructured data collected is then parsed and converted to profile features for each customer using
NLP, Classification Algorithms, Regex and other Big Data processing tools.

• The profile features are used to form a credit worthiness score for the customer, leveraging advanced ML
algorithms and credit risk modelling tools.

• This credit worthiness score is then provided to lenders in real time, used by lenders to make decisions to
approve or reject a customer’s loan application, with high confidence.
 Round2 - Case Statement and Evaluation
FinBox Credit Score, developed in 2019, is used by FinBox’s lending partners to make approval decisions for incoming
loan applications. However, post Covid19, score performance has deteriorated, due to macro-economic changes and
incoming population distribution.

Serving as members of FinBox’s Data Science Team, you have been given an assignment to use data collected from
DeviceConnect to create a new Credit Score for the customers and design data driven strategy for underwriting loans.

Underwriting strategy should be designed with an objective to maximize profitability.

For every good customer approved, profit is Rs. 1,000. For every bad customer approved, loss is Rs. 25,000. For Rejected
Customers, there is no loss or profit.

(Even though, it is advised to create and use a statistical credit score in the strategy, to better predict customer who are
more likely to default, it is not mandatory)

The approval decision submitted by the teams, on production data, would be checked against their observed default
flags, to calculate overall profitability and the team with maximum calculated profitability, would be shortlisted for Round
3.
 Input Files
• File “development_customers_device_data.csv”
• This file contains “customer_id” column and other 80 feature columns to be used as profile features to create
credit score.

• File “development_customers_default_data.csv”
• This file contains “customer_id”, “date_of_loan”, and “customer_default_flag”
• If customer_default_flag = 1, means a customer is identified as a bad customer.

• File “production_customers_device_data.csv”
• This file contains “customer_id” column and other 80 feature columns same as the one in development, for which
the output score (if applicable) and approval flag needs to be provided.

• File “feature_dictionary.csv”
• This file contains “feature_name” and “feature_description” column for 80 features created through device data.
 Submission Format
Round 2

• Excel - File Name “<TeamName>_production_customers_score_approval.xlsx”

This file should have all the customers present in “production_customers_device_data.csv” and contain 3 columns:
“customer_id”, “credit_score”, “approval_flag”:
• “credit_score” should be numeric value (if customer credit score created else leave blank)
• “approval_flag” should have values 1 or 0. (1 for Approved, 0 for Rejected)

Round 3

• PowerPoint - File Name “<TeamName>_FinBox_DeviceConnect_Case.pptx” (5-8 slides : 15+10 mins)

Broad Content guidelines:

• Data Overview, Understanding and Initial Insights
• Underwriting Strategy Designed and Approach taken – How were the credit score and approval flag in Round 2
calculated (Sample UW strategies illustrated in Appendix A)
• Customer Segmentation within the Portfolio – Types of customers seen
• Go to Market strategies to approach profitable customer segments
 Appendix A – Sample Strategies
Sample 1

Strategy Rule Decision

Credit Score > <Cutoff> Approve
Else Reject

Sample 2
Strategy Rule Decision
Credit Score > <Cutoff> or <Some Features> <Some Conditions> Approve
Credit Score > <Cutoff> and <Some Features> <Some Conditions> Approve
Credit Score > <Cutoff> Approve
Else Reject

Sample 3
Strategy Rule Decision
<Some Features> <Some Conditions> Reject
Else Approve