Why Simple Rule Engine?

Rationale behind the need for a simple rule engine

Decision-making has always been at the heart of any business. In certain industries (such as Lending), some of the decisions made are so dynamic & in flux that programming these decisions by hand is counter-productive.

Take the example of the decision to give someone a loan. It primarily involves ascertaining two fundamental factors:

  • Ability to repay the loan.

  • Intent to repay the loan.

When you start assessing a borrower based on the above, you typically get all facts required to make a decision (such as Bureau score, bank statements, etc.) and you will pass these facts through a decision matrix to arrive at

  • A composite score on a scale that gives an indication of whether the borrower will repay the loan (intent)

  • A recommendation of how much loan should be given to the borrower. (ability)

The aforementioned decisions involve the evaluation of multiple parameters. You cannot write a program to solve such complex scoring or decision problems:

  • The evaluations and/or scores will always change over a period of time to adjust to business needs

  • The rules will also vary based on the nature of the business product.

In the next section, let us look at some examples from Lending Industry which calls for a Rule Engine solution.

References

Rules Engine by Martin Fowler

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