• Once we approve a credit card application for a customer, the

next step is to assign initial line (credit limit) to the newly

approved lending card.

• Line on a credit card account is the guaranteed amount till

which a customer can have balance with us in good standing.

• Initial line assignment strategy is extremely critical decision

which not only drives profitable revenue growth for Amex but
also customer engagement while controlling for our risk and
exposure.

• It’s a game of balance – assigning too low a line decreases

customer capacity to spend thus reducing profitability, assign
too high a line and risk increases exposing us to credit losses.
Getting this balance right is the one of the most critical
problems to solve.

• Think about how a credit line would affect you and your
spending and borrowing behavior.
Create Initial line assignment strategy for customers who got approved for credit card to maximize long-
term profitability

• You’ll need to consider model predicted line and cover for change in profitability

• You need to decide what line each customer should get

Total long-term profitability (2 years) generated from line assignment will be the leading success metric for
evaluation
• Data provided (both development and leaderboard data) for the challenge is random assigned line data where for any
approved applications line was assigned on random basis

• Purpose of random assignment of line is to gauge segment level performance at different random line and select lines for
each segment where performance (actual 2 years performance) is the best

• Data provided has following types of attributes

Internal Data External Data Performance Data

Includes the internal data like product Includes the bureau data like bureau score,
Actual 2-year performance data
details, model predicted outputs customer attributes

Product Details – Proprietary or cobrand,

Bureau Score
product fee details
+
+ Average spend, balance, revenue, loss &
Delinquency details on external trades
Model predicted risk score profit
+
+
Balance and Paydown on external trades
Model predicted optimal line
• Leverage attributes provided to define different segments

• For each segment, evaluate performance across different random line assigned within a segment

• While evaluating performance apart from profitability, look out for loss coverage ratio and efficiency as well
• Profitability = Revenue – Loss

• Loss Coverage Ratio (LCR) = Revenue/Loss :

• Provides us information on how much leverage we have in long term over losses covering for recessionary scenario
(where losses could double with revenue being stagnant)
• Efficiency = Profitability/Line
• Provides us information about how efficient is our line assignment process. Lower efficiency means we are giving higher
line but not getting enough profit out of it.

• For each segment, define line assignment strategy based on above analysis leveraging already provided model output line (your final
line should be using model output line as one of the inputs)

• Key decision points to keep in mind are customer risk, product type, model line, external line, external behavior and customer
capacity
This competition will run in 3 rounds :

Round-1:
Round-2: Round-3:
Leaderboard
Deck Submission Virtual Interaction
Submissions
• Participants will build their line assignment strategy using development data provided
• Score the leaderboard dataset using their chosen strategy logic
• Submit your output in form of CSV with two columns without header Unique ID and Final Line
• The Final Line value should be from the below unique values:
• 1000, 2000, 4000, 6000, 8000, 10000, 15000, 20000, 25000, 30000
• Final line should match random line for at least 10% of the leaderboard data
• Frequency of any Final line value (as given in point 1) shouldn’t be greater than 30%

• Evaluation Metric Score: = 0.4 * Delta Profitability + 0.4 * Delta LCR + 0.2 * Delta Efficiency
• Delta Profitability (in BPS)= (Profitability at Candidate Line - Profitability at Benchmark Line)/ (Profitability
at Candidate Line)
• Delta LCR (in BPS) = (LCR at Candidate Line - LCR at Benchmark Line)/ (LCR at Benchmark Line)
• Delta Efficiency (in BPS) = (Efficiency at Candidate Line - Efficiency at Benchmark Line) / (Efficiency at
Benchmark Line)

• Teams will see their score post each submission.

• Top 20 teams with highest score will be displayed on a Leaderboard
Top 10 teams in leaderboard based on Round 1 results are eligible for this
round.

Submit your code with brief about your approach, considerations and any
analysis used to finalize the campaign

Teams will also create a presentation detailing their approach

and insights derived.

Evaluation Criteria – Qualitative

▪ Methodology & Thought process: Ideas & Approaches Tried
▪ Assumptions made
• Shortlisted teams from Round 2 will qualify for Round 3 based on
their score from Round 1 and deck submission from Round 2
• They will be asked to present their respective deck to a panel.
• Presentations will be evaluated based on novelty in approach, ease
of execution of the solution and clarity in articulation.

Top 3 teams will be selected as winners based on leaderboard

Data score as well as qualitative and presentation evaluation