Deep Learning for Credit Risk Prediction: A Survey of Methods, Applications, and Challenges

Credit risk prediction is central to financial stability and regulatory compliance, guiding lending decisions and portfolio risk management. While traditional approaches such as logistic regression and tree-based models have long been the industry standard, recent advances in deep learning (DL) have introduced architectures capable of capturing complex nonlinearities, temporal dynamics, and relational dependencies in borrower data. This study provides a comprehensive review of DL methods applied to credit risk prediction, covering multi-layer perceptron, recurrent and convolutional neural networks, transformer, and graph neural networks. We examine benchmark and large-scale datasets, highlight peer-reviewed applications across corporate, consumer, and peer-to-peer lending, and evaluate the benefits of DL relative to classical machine learning. In addition, we critically assess key challenges and identify emerging opportunities. By synthesising methods, applications, and open challenges, this paper offers a roadmap for advancing trustworthy deep learning in credit risk modelling and bridging the gap between academic research and industry deployment.

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Published
2026-04-21
DOI
https://doi.org/10.3390/info17040395
Primary Topic
Financial Distress and Bankruptcy Prediction
Type
article
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article

Deep Learning for Credit Risk Prediction: A Survey of Methods, Applications, and Challenges

Ebenezer Esenogho, Ibomoiye Domor Mienye, Cameron Modisane
Information
Financial Distress and Bankruptcy Prediction
article

Deep Learning for Credit Risk Prediction: A Survey of Methods, Applications, and Challenges

Ebenezer Esenogho, Ibomoiye Domor Mienye, Cameron Modisane
article en

Abstract

Credit risk prediction is central to financial stability and regulatory compliance, guiding lending decisions and portfolio risk management. While traditional approaches such as logistic regression and tree-based models have long been the industry standard, recent advances in deep learning (DL) have introduced architectures capable of capturing complex nonlinearities, temporal dynamics, and relational dependencies in borrower data. This study provides a comprehensive review of DL methods applied to credit risk prediction, covering multi-layer perceptron, recurrent and convolutional neural networks, transformer, and graph neural networks. We examine benchmark and large-scale datasets, highlight peer-reviewed applications across corporate, consumer, and peer-to-peer lending, and evaluate the benefits of DL relative to classical machine learning. In addition, we critically assess key challenges and identify emerging opportunities. By synthesising methods, applications, and open challenges, this paper offers a roadmap for advancing trustworthy deep learning in credit risk modelling and bridging the gap between academic research and industry deployment.

InformationVol. 17(4)
University of South Africa (ZA)
Industry, innovation and infrastructure
Openalex Percentile: Top 16%
Financial Distress and Bankruptcy Prediction
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