Loan Prediction Using Machine Learning

Abstract

Loan prediction is a significant problem in the banking industry. Using Technology, will change and make some improvements in Loan prediction by bank employees manually. By using "Machine learning "in loan prediction. The machine learning system will check the data for a loan of the applicant and the data will be checked so fast and without any human error. So, it will help to improve technology in Bank sectors. By this, processing the data will be checked quickly, making the data output in less time. It helps both the applicant and the bank employees.Machine learning algorithms can be used to analyze historical data and make accurate predictions about whether a loan application will be approved or not. In this study, we propose a machine learning-based loan prediction model that utilizes various features such as credit score, income, loan amount, and loan term. We explore different classification algorithms, including logistic regression, decision tree, and random forest, to build the loan prediction model. Our experimental results show that the random forest algorithm outperforms other models with an accuracy rate of 83.45%. The proposed model can help banks and financial institutions streamline their loan approval process, reduce manual effort, and minimize the risk of bad loans.