Gini Coefficients is a statistical measure used to evaluate how powerful the Creditsafe UK scorecards are in predicting who will fail within the next 12 months. The Coefficient ranges from 0.00 to 1.
The more effective a credit score, the better it is at giving lower scores to riskier applicants, and higher scores to safer applicants. However, it is impossible to devise a scorecard which could perfectly predict all future insolvencies, which would not also inadvertently classify some stable businesses as high risk. To avoid this, we create a scorecard which finds the most optimal balance between business risk prediction and opportunity maximisation.