Credit ratings is critically important to banks, businesses, investors and government. 2004 first saw Vietnam to have a company providing this service – VietnamCredit, the pioneer in credit rating platform of Vietnam.
Credit ratings is a very complex process as information constantly changes over time. It is assessed based on many different criteria. Accordingly, the role of experts is literally important. VietnamCredit experts have formed a set of criteria in which 40% of evaluation is of finance (quantitative) and 60% is of non-finance (qualitative). Currently in Viet Nam, the quantification of qualitative factors (indicated by language, ambiguity) is limited and rigid.
Vietnam is a developing country with rapidly changing frameworks of society and business environment, so it is not suitable to completely apply international evaluation models.
To increase the accuracy of our ratings and to best support businesses, VietnamCredit has been considering the application of Fuzzy logic techniques to business credit rating with the aim of "quantifying emotions" and “softening decision making process”. Instead of using a scale of 1 to 10, evaluation criteria are expressed in language (eg, Extremly good (EG), Between G – EG, Good (G)) and fuzzled in fuzzy numbers.
The research “THE APPLICATION OF FUZZY LOGIC TO CREDIT RATINGS” conducted by our two qualified experts Mr. Nguyen Hai and Ms. Hoang Hien was represented and discussed in our regular meeting. Along with that, VietnamCredit has come to an agreement to establish a process of business credit rating based on the Fuzzy multi-criteria Decision Model (FMCDM). Hopefully, with the efforts to continuously develop, the products of VietnamCredit will be a powerful tool in making business decisions.