Article 6
Use of models
1. For the purposes of Article 6(2), third subparagraph, of Regulation (EU) 2020/1503, crowdfunding service providers shall provide adequate information on the models included in the method used for the credit risk assessment of crowdfunding projects, for the assessment of the creditworthiness of project owners, for the credit approval and monitoring processes, and for the composition of portfolios, including all of the following:
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(a) |
the source of the data used as input for the models; |
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(b) |
the framework employed to ensure the quality of the input data; |
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(c) |
the existence of appropriate governance arrangements for the design and use of such models; |
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(d) |
the framework to ensure that the quality of the model output is regularly assessed and validated, and where appropriate, reviewed. |
2. When automated models are used as part of the method for the credit risk assessment of crowdfunding projects, in the creditworthiness assessment of project owners, in the credit approval and monitoring processes, or in the composition of portfolios, crowdfunding service providers shall disclose all of the following:
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(a) |
how the use of automated models is appropriate to the size, nature and complexity of the types of crowdfunding project selected for the investor’s portfolio; |
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(b) |
the conditions for the application of automated decision-making in the credit-approval and monitoring processes, including identifying loans, segments and limits for which automated decision-making is allowed. |