Fairness Evaluation of Credit Approval Algorithms: Group Variance Analysis after Controlling for Key Variables

With the rapid development of financial technology, algorithmic credit approval systems have been widely adopted, especially in credit. However, the algorithm system is very likely to have systemic injustice. So, this study is concerned about the potential bias in the credit approval algorithm system, investigating the dimensions that bias is most likely to exist in such as gender, education, and home ownership. The author collected the approval rate data from Kaggle to conduct this study. The author used EXCEL to conduct fundamental analysis and use SPSS to conduct further binary logistic regression to test the relationship between the credit approval rate and these variables. The results show that there are no significant biases in the field of gender and education. However, significant disparities were found for home ownership status even after controlling key financial factors. This study helps to evaluate the fairness of the algorithm and thus helps to promote the transparency and fairness of algorithms in the field of credit.

Authors

Institutions

Publication Details

Journal
Advances in Economics Management and Political Sciences
Published
2025-10-14
DOI
https://doi.org/10.54254/2754-1169/2025.bl27865
Primary Topic
Impact of AI and Big Data on Business and Society
Type
article
Field-Weighted Citation Impact
0.00
Controls
|||
ALL TIME
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
article

Fairness Evaluation of Credit Approval Algorithms: Group Variance Analysis after Controlling for Key Variables

Xinyi Zeng
Advances in Economics Management and Political Sciences
Impact of AI and Big Data on Business and Society
article

Fairness Evaluation of Credit Approval Algorithms: Group Variance Analysis after Controlling for Key Variables

Xinyi Zeng
article en

Abstract

With the rapid development of financial technology, algorithmic credit approval systems have been widely adopted, especially in credit. However, the algorithm system is very likely to have systemic injustice. So, this study is concerned about the potential bias in the credit approval algorithm system, investigating the dimensions that bias is most likely to exist in such as gender, education, and home ownership. The author collected the approval rate data from Kaggle to conduct this study. The author used EXCEL to conduct fundamental analysis and use SPSS to conduct further binary logistic regression to test the relationship between the credit approval rate and these variables. The results show that there are no significant biases in the field of gender and education. However, significant disparities were found for home ownership status even after controlling key financial factors. This study helps to evaluate the fairness of the algorithm and thus helps to promote the transparency and fairness of algorithms in the field of credit.

Advances in Economics Management and Political SciencesVol. 220(1)
Nanjing Foreign Language School (CN)
Openalex Percentile: Top 66%
Impact of AI and Big Data on Business and Society
AI Navigator

Ask Laika to Summarize, Analyze, and Connect papers live on the map.

Summarize Papers & Methodologies

Extract key findings, datasets, and comparative methods across publications.

Benchmark Rankings & Visual Analytics

Rank top research institutions, authors, funders, topics, and journals by Field-Weighted Citation Impact (FWCI) and paper volume with instant charts.

Connect Distant Disciplines

Bridge topological clusters on the map to find hidden collaborative intersections.

Fairness Evaluation of Credit Approval Algorithms: Group Variance Analysis after Controlling for Key Variables — Xinyi Zeng · Advances in Economics Management and Political Sciences (2025) | TGRS Research Map | TGRS