The design on credit decision mechanism (CDM) from opportunity benefit

In this paper, we establish a nonlinear programming model on credit decision. We introduce the theory and methods of incentive mechanism design in the study of an entrepreneur who pursues opportunity benefits with imperfect information. We derive a concrete optimal credit decision mechanism (CDM) under a mortgage loan. We also discuss the problem of credit rationing and the CDM involving rationing and non-rationing, respectively. In addition, we suggest that the bank cannot make the decision in providing the loan or denying the applicant.