Gender-Intentional Credit Scoring

Evidence shows that women tend to have, on average, better loan repayment rates than men. The fact that the women receiving loans are, on average, lower risk than the men implies that women are being subjected to a comparatively higher bar for loan approval than men. These conditions present an opportunity to adjust lending models to more accurately assess risk and, as a result, increase financing to women.

This guide shows that a disaggregated gender analysis of a loan portfolio can unveil potential gender-intentional strategies to grow both the total loan book and the share of women borrowers without increasing the portfolio’s credit risk. Because a gender-intentional approach can help lenders more accurately measure portfolio risk, such approaches not only can reduce the gender gap in access to credit, but they can make good business sense, by allowing providers to increase their portfolios or reduce their losses.

This guide presents a gender-lens analytical framework that lenders can use to determine whether lending decisions and outcomes in their portfolios differ by gender and, if so, how.