However, it is important to understand what makes up the components of this intellectually crafted credit scoring system that provides Cedar Rose, and, subsequently, our clients, with such a useful tool.
How does credit scoring work?
The hidden benefit that the award-winning CR Score holds, and perhaps one of its most unique features, is the fact that it can create an accurate credit score even when there is no available financial data. This smart AI technology, based on a fixed algorithm, combines certain parameters until it concludes at a robust score for the company in question.
The mathematical equation behind the CR Score relies upon 14 different factors that are carefully analysed and assessed to compute for a rating between -5 to 5 (-5 being very bad and 5 being excellent). One of the ingenious components of the CR Score is the fact that the weight of each factor is entirely dependent on the level of effect the factor will have on the business.
This allows the scorecard to adjust accordingly and truly give an accurate and reliable scrutiny of the level of risk of a business.
After the algorithm logically and extensively combines all the available information of a company it will produce a score from 0-100 which depicts the overall level of risk (0 being high risk and 100 being low risk). The credit rating of the company is conclusively determined using two factors: the CR score [which in itself is composed of 14 factors] and the Company Size.
Some of the ratings are also variable which allows for a more accurate result. For example, the country risk factor will be variable dependent on the country, if the country is experiencing war, the risk will be obviously higher than a country at peace. The country risk factor also has an array of factors to produce the most robust result and it is carefully assessed and adjusted to the final scorecard.
Why do you need it?
Automated scorecards are a prompt indicator allowing instant decision making. The formula is applied on all the available data which allows the CR Score to be an instant scoring system like no other.
Furthermore, the accuracy of the scorecard is second-to-none. It was developed by experienced, local, qualified and certified analysts over two years with the benefit of access to over two decades of prior experience in manual credit risk assessment. The flexibility of the algorithm is a stern feature that indicates the true superiority of the CR Score.
It takes any available information obtained from reliable sources into consideration with an allocated weight affecting the Total Score. This adaptive tool provided by Cedar Rose can be the automated process you require to evaluate credit risk efficiently.
Furthermore, due to the automation, it eliminates the need for human intervention and assessment and saves time for credit analysts and clients, which, in turn, reduces the operating costs. It can even be applied to your own customer data via API.
Conclusively, the CR Score provides consistent results based on an array of carefully thought out factors via specialist data scientists. This free feature in Cedar Rose`s credit reports may just be your lifeline, your deciding component and your best friend for making informed decisions for the long-term benefit of your company. There are many reasons why Cedar Rose is amongst the most trusted, respected and relied on credit reporting agencies, and the CR Score is one of them.