Customer Churn Prediction in the Banking Sector Using Sentence Transformers and a Stacking Ensemble Framework
Journal Title: Acadlore Transactions on AI and Machine Learning - Year 2025, Vol 4, Issue 2
Abstract
As market saturation and competitive pressure intensify within the banking sector, the mitigation of customer churn has emerged as a critical concern. Given that the cost of acquiring new clients substantially exceeds that of retaining existing ones, the development of highly accurate churn prediction models has become imperative. In this study, a hybrid customer churn prediction model was developed by integrating Sentence Transformers with a stacking ensemble learning architecture. Customer behavioral data containing textual content was transformed into dense vector representations through the use of Sentence Transformers, thereby capturing contextual and semantic nuances. These embeddings were combined with normalized structured features. To enhance predictive performance, a stacking ensemble method was employed to integrate the outputs of multiple base models, including random forest, Gradient Boosting Tree (GBT), and Support Vector Machine (SVM). Experimental evaluation was conducted on real-world banking data, and the proposed model demonstrated superior performance relative to conventional baseline approaches, achieving notable improvements in both accuracy and the area under the curve (AUC). Furthermore, the analysis of model outputs revealed several salient predictors of customer attrition, such as anomalous transaction behavior, prolonged inactivity, and indicators of dissatisfaction with customer service. These insights are expected to inform the development of targeted intervention strategies aimed at strengthening customer retention, improving satisfaction, and fostering long-term institutional growth and stability.
Authors and Affiliations
Jing Gao, Huiyi Wang, Yuanlin Lu, Lina Yu
Keywords
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- EP ID EP767837
- DOI https://doi.org/10.56578/ataiml040204
- Views 16
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