A socio-technical approach to the evaluation of social credit applications

Abstract

Social credit is a type of micro-credit aiming at fighting poverty and social inequality. Although interest in this type of credit has increased significantly over time, namely after Muhammad Yunus was awarded the 2006 Nobel Peace Prize, there are few studies that address the assessment of social credit applications. This is an issue to be taken seriously primarily because the objectives of social credit differ from those of other types of credit, meaning that social credit applications should not be evaluated using the same credit-scoring systems. Assuming the baseline principles of the multiple criteria decision analysis (MCDA) approach, this study combines cognitive mapping and measuring attractiveness by a categorical-based evaluation technique (MACBETH) to develop an evaluation system for social credit applications. The results show that the social-technical approach followed in this study provides value for the evaluation processes of this type of credit application as a result of the privileged contact established with a panel of credit analysts. The advantages, limitations and managerial implications of our study are also discussed.

Keywords:

• Social credit
• credit-scoring
• cognitive mapping
• MCDA
• MACBETH

Acknowledgements

This study is an outcome of a larger research project on social credit. Records of the expert panel meetings, including pictures, software output and non-confidential information of the study can be obtained from the corresponding author upon request. The authors gratefully acknowledge the superb contribution and knowledge sharing of the expert panel members: Amílcar Lourenço, Carlos Morais, Cláudia Rato, Humberto Alves, Rita Fortunato and Rui Leal.