Credit Decisioning

Credit Decisioning is a process that a lender or other financial service uses to assess the creditworthiness or risk of a potential borrowerfor the ability to pay back the debt and likelihood of default and taking a decision to approve or reject the application. The configuration of the lending product that is chosen drives the rules and workflows related to credit analysis, scoring, pricing, and documentation tasks and approvals.

You can use multiple ways to arrive at a credit decision. For example, you must review each customer's credit history; this helps you evaluate their risk profile and creditworthiness, thus managing lending risks to remain profitable. After an application is created, you can attach scorecards to an application to evaluate it based on different sets of criteria to arrive at a weighted score. You can also perform a Credit Pull followed by a Credit Decision and assign a credit rating to the application.

This depends on the following main factors:

• Lender guidelines, and

• Risk mitigating factors, some of which are:

• • rate/payment reduction, 

  • cash reserves of the borrower, 

  • verified liquid assets, 

  • credit report,

  • other.

As part of credit evaluation for decisioning:

• A credit rating is provided for businesses or a government but not an individual. 

• A credit score is provided for individuals.

You can define various credit ratings in Q2 Origination through the Credit Rating Matrix and associate an application with a particular rating depending on a score range. You can configure this credit score or credit rating assignment process through the Salesforce Process Builder. For example, you may create a Credit Rating Assignment process and set it up to be triggered when the application status changes to Scorecard Generated. Once triggered, this process would evaluate pre-defined criteria around factors like application score and credit score to assign the final credit rating or score. Once a rating or score is assigned, the application status changes to Credit Rating Assigned.

Credit decisioning is based on Workflow Rules. You can similarly define workflow rules in Salesforce for approving and declining credit.

Auto Decisioning

Auto decisioning is the process of systematic decision-making without human intervention. It automates the application processing up to the stage of credit rating assignment.

See Auto Decisioning in the Creating a Consumer Loan Application section for more information.