Neural Networks in Business and Banking

Neural Networking in Business and Banking


Neural network applications are being used to predict bankruptcy,
costs, revenue forecasts, document processing and more. It detects
common characteristics and classifies large amounts of information.
This data can then be used to determine relationships between
business factors and forecast changes and effects. This approach
can potentially help predict bankruptcy for credit risk or sales
forecasting. Using previous data can help establish trends that
banks can use to predict high risk loans. Data from studies concerning
credit risks can be evaluated by extracting different rules for
determining credit risk. Neural network decisions can clarify
by explanatory rules that capture learned knowledge embedded
in the network as to an applicants level of risk for default on loans.
In a nutshell, neural networks are used to predict certain outcomes
or probabilities as to whether an event constitutes a high or low
amount of risk. This enables businesses to make better business
decisions.

Greg Burrow