Credit Rating Using Type-2 Fuzzy Neural Networks

Nowadays various new technologies such as artificial neural networks, genetic algorithms, and decision trees are used for modelling of credit rating. This paper presents design of credit rating model using a type-2 fuzzy neural networks (FNN). In the paper, the structure of the type-2 FNN is designed and its learning algorithm is derived. The proposed network is constructed on the base of a set of fuzzy rules that includes type-2 fuzzy sets in the antecedent part and a linear function in the consequent part of the rules. A fuzzy clustering algorithm and gradient learning algorithm are implemented for generation of the rules and identification of parameters. Effectiveness of the proposed system is evaluated with the results obtained from the simulation of type-2 FNN based systems and with the comparative simulation results of previous related models.

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