Nathan India worked with BASIX, a microfinance institution in India, to analyze customers' borrowing behavior and lenders' responses.
We developed questionnaires and surveyed Livelihood Service Advisors (LSAs) to understand how they evaluated loan applications. We first surveyed 100 LSAs in four states to discern which factors the LSAs consider the most important in identifying potential loan applicants. We then ranked the factors, created mutually exclusive and exhaustive combinations of the factors, and presented the list of combinations of factors to 200 LSAs from seven states. These LSAs were asked to record the decision they would make in each case.
We used the resulting survey data and borrower transaction data of 100,000 customers to develop an empirical tool that mimics the LSA decision making process. BASIX was then able to formalize the loan application process and reduce the time and cost of processing.