What's in the "Black Box" -- the Balance Between Digital Consumer Loans and Privacy from the Perspective of Inclusive Finance Part 1

Traditional loan

The basic model logic of any bank loan is the same – to look for the price difference between customers who can repay the loan at a higher interest rate and customers who can't repay the loan. In traditional banks, the work of screening the lender's credit will fall on the credit officer or credit manager. Not only will they judge whether there is financial risks in a person from rigid standards, but also they will be affected by intuition. Another criterion is credit score, which is similar to the information used by credit card companies to evaluate potential cardholders, but information viewing is labor-intensive.

Financial technology loan

Fintech loan business appeared in some Internet start-ups, which abandoned the traditional loan model and reduced the borrower's expenditure in a faster, more efficient and lower cost way. The core of financial technology is to regard technology as a substitute for traditional finance. It contains a wide range of businesses, and loan is only one of them.