Financing-Limit Prediction Classifier in Islamic Bank Using Tree-Based Algorithms
Journal Title: Journal of Islamic Contemporary Accounting and Business - Year 2025, Vol 3, Issue 1
Abstract
Islamic banks are one of the financial institutions that has been proven to be the catalyst to end extreme poverty in the world. However, amid the massive development of Industry 5.0, research about technology adaptation in Islamic banks is still considered rare. The aim of this study is to develop a technology that will help Islamic banks in making their financing decision more efficient. By using the current outstanding financing data in an Islamic bank, this study proposes a machine learning algorithm that could predict a financing limit based on customer classification. The tree-based learning algorithms used to build the algorithm have shown impressive results. The results show that the basic algorithm which is the Decision Tree gives 86% prediction accuracy. The algorithm is then improved by using the Random Forest algorithm. The Random Forest algorithm gives 91% prediction accuracy which significantly improves the base learning algorithm. Future research in this area is needed as the need to implement sophisticated technology is prominent in making Islamic banking more accessible across the globe.
Authors and Affiliations
Mutya Qurratu'ayuni Mustafa Muhammad Riza Iqbal Latief Dewi Febriani
Keywords
Related Articles
- EP ID EP761203
- DOI 10.30993/jicab.v3i1.520
- Views 22
- Downloads 1
The Effect of Financial Soundness Level on Premium Growth of Companies Listed in AASI
Analyze how the effect of financial health level as measured by liquidity ratio, investment balance ratio with liabilities, investment income ratio, claim expense ratio, tabarru' fund change ratio, and risk-based capital...
The Impact of Debt on Firm Value: An Analysis of the UK Market
This study examines the impact of debt on firm value within the UK stock market, focusing on the unique economic, regulatory, and market conditions of the region. Using a descriptive quantitative analysis and regression...
The Effect of Organizational Culture, Competence, Compensation, and Work Motivation on Employee Performance at Bank Syariah Indonesia Jepara Branch Office
This study aims to analyze and obtain empirical evidence regarding the effect of organizational culture, competence, compensation, and work motivation on employee performance in Bank Syariah Indonesia Sub-Branch Office J...
Financial Performance Analysis of Regional Companies (Case Study on Regional Company “Rengganis” Probolinggo Regency, East Java 2018-2020)
The Rengganis Regional Company of Probolinggo Regency is a company engaged in services that manages (Sports Building) Sasana Krida Gymnasium & Tennis Court, Jabung Tirta Swimming Pool and Bremi Pesanggrahan. To determine...
The Influence of Operating Profit and Loss and the Size of The Public Accounting Firm on Audit Delay
This research aims to determine and analyze the influence of Operating Profit and Loss and the Size of the Public Accounting Firm (KAP) partially on Audit Delay. The influence of Operating Profit and Loss and Size of the...