Glossary
Risk-based pricing
Risk-based pricing is setting the interest rate or terms a borrower is offered according to their assessed risk, so higher-risk borrowers pay more and lower-risk borrowers pay less. It lets lenders serve a wider range of customers while managing expected losses.
Good risk-based pricing depends on accurate risk assessment and must be balanced against fair value under the Consumer Duty.
How Credit Canary helps with risk-based pricing
Credit Canary brings the data, decisioning and payments behind Risk-based pricing into one platform for UK lenders.
Decisioning EngineRelated terms
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