BANK LOAN APPROVAL DATA ANALYZE AND PREDICTION USING

DATA SCIENCE TECHNIQUE(ML)

Submitted in partial fulfillment of the requirements for the award of Bachelor

of Engineering degree in Computer Science and Engineering

by

GUNNAM SRINIVASU (Reg. No. 38110180)

ALLAM SHANKAR PAVAN KALYAN (Reg. No. 38110026)

DEPARTMENT OF COMPUTER SCIENCE AND ENGINEERING

SCHOOL OF COMPUTING

SATHYABAMA
INSTITUTE OF SCIENCE AND TECHNOLOGY
(DEEMED TO BE UNIVERSITY)
Accredited with Grade “A” by NAAC
JEPPIAAR NAGAR, RAJIV GANDHI SALAI, CHENNAI - 600 119

MAY - 2022
 DEPARTMENT OF COMPUTER SCIENCE AND ENGINEERING

BONAFIDE CERTIFICATE

This is to certify that this Project Report is the bonafide work of GUNNAM SRINIVASU
(Reg. No: 38110180), ALLAM SHANKAR PAVAN KALYAN (Reg. No: 38110026) who
carried out the project entitled “BANK LOAN APPROVAL DATA ANALYZE AND
PREDICTION USING DATA SCIENCE TECHNIQUE (ML)” under my supervision from
November 2021 to April 2022.

Internal Guide External Guide (if Applicable)

Dr. M. MAHESWARI M.E., Ph.D.,

Head of the Department

Dr. L. LAKSHMANAN M.E., Ph.D.,

Submitted for Viva voce Examination held on

Internal Examiner External Examiner

 DECLARATION

I GUNNAM SRINIVASU, ALLAM SHANKAR PAVAN KALYAN hereby declare that the

Project Report entitled BANK LOAN APPROVAL DATA ANALYZE AND PREDICTION

USING DATA SCIENCE TECHNIQUE (ML) done by me under the guidance of Dr. M.

Maheswari M.E., Ph.D., (Internal) is submitted in partial fulfillment of the requirements for

the award of Bachelor of Engineering Degree in Computer Science and Engineering.

DATE: 15-03-2022 G. Srinivasu

PLACE: CHENNAI SIGNATURE OF THE CANDIDATE

 ACKNOWLEDGEMENT

I am pleased to acknowledge my sincere thanks to Board of Management of

SATHYABAMA for their kind encouragement in doing this project and for completing it
successfully. I am grateful to them.

I convey my thanks to Dr. T. Sasikala M.E., Ph.D, Dean, School of Computing Dr. L.
Lakshmanan M.E., Ph.D. , and Dr. S. Vigneshwari M.E., Ph.D. Head of the Department,
Dept. of Computer Science and Engineering for providing me necessary support and
details at the right time during the progressive reviews.

I would like to express my sincere and deep sense of gratitude to my Project Guide Dr.
M. Maheswari ME., Ph.D for his valuable guidance, suggestions and constant
encouragement paved way for the successful completion of my project work.

I wish to express my thanks to all Teaching and Non-teaching staff members of the
Department of Computer Science and Engineering who were helpful in many ways for
the completion of the project.
 ABSTRACT

Loans are no longer considered a last resort to buy a sought-after smartphone or a

dream house. Over the last decade or so, people have become less hesitant in applying
for a loan, whether it’s personal, vehicle, education, business, or home especially when
they don’t have a lump sum at their disposal. Besides, Home and Education Loans
provide tax advantages that reduce tax liability and increase the cash in hand from
salary income.to get loans with minimal paperwork, quick eligibility checks, and
competitive interest rates. They have opened an online channel to apply and submit
documents for the approval process. If you still find the loan application and review
process intimidating, credit history is indicative of your future repayment behaviour,
based on your pattern in settling past loans. It helps the bank to know if you will be
punctual and regular with your payments. Banks weigh your employment history and
current engagement to ensure that your source of income is reliable.

i
 TABLE OF CONTENTS

CHAPTER TITLE PAGE

No. No
ABSTRACT i

LIST OF FIGURES v

1 INTRODUCTION 1
1
1.1 Objective of the project 1
1.1.1 Necessity 1
1.1.2 Software development method 1
1.1.3 Layout of the document
1.2 Overview of the designed project 2

2 LITERATURE SURVEY 3

2.1 Literature Survey 3

3 AIM AND SCOPE OF THE PRESENT INVESTIGATION 8

3.1 Project Proposal 8

3.1.1 Mission 8
3.1.2 Goal 8
3.2 Scope of the Project 8
3.3 Overview of the project 8
3.4 Existing system 9
3.4.1 Disadvantages 9
3.5 Preparing the dataset 9

3.6 Proposed system 10

3.6.1 Exploratory Data Analysis of loan approval 10

3.6.2 Data Wrangling 10
3.6.3 Data collection 10
3.6.4 Building the classification model 10

3.6.5 Advantages 11
3.8 Flow chart 12

ii
4 EXPERIMENTAL OR MATERIALS AND METHODS; ALGORITHMS 13
USED

4.1 System Study 13

4.1.1 System requirement specifications 13

4.2 System Specifications 13

4.2.1 Machine Learning Overview 13

4.2.2 Flask Overview 14

4.3 Steps to download & install Python 14

4.3.1 IDE Installation for python 14

4.3.2 Python File Creation 14

4.4 Python Libraries needed 14

4.4.1 Numpy library 15

4.4.2 Pandas library 15

4.4.3 Matplotlib library 15

4.4.4 Seaborn library 16

4.4.5 Scikit Learn library 16

4.4.6 Flask 16

4.5 Modules 17

4.6 UML diagrams 18

4.6.1 Use Case Diagram 18

4.6.2 Class Diagram 19

4.6.3 Activity Diagram 20

4.6.4 Sequence Diagram 21

4.6.5 Entity Relationship Diagram 22

4.7 Module Details 23

4.7.1 Data Pre-processing 23

4.7.2 Data Validation /Cleaning /Preparing Process 24

4.7.3 Exploration data analysis of visualization 25

4.7.4 Comparing Algorithm with prediction in the form of best

accuracy result 26
4.7.5 Algorithm and Techniques 30
4.7.6 Deployment Using Flask 40

iii
5 RESULTS AND DISCUSSION, PERFORMANCE ANALYSIS 42

5.1 Performance Analysis 42

5.2 Discussion 42

6 SUMMARY AND CONCLUSION 43

6.1 Summary 43
6.2 Conclusion 43
6.3 Future Work 43

REFERENCES 44

APPENDIX
A. SOURCE CODE 45-49
B. SCREENSHOTS 50-52

iv
 LIST OF FIGURES

FIGURE NO. FIGURE NAME PAGE NO.

3.1 Architecture of Proposed Model 11
3.2 Flow chart 12
4.1 System Architecture 18
4.2 Use Case Diagrams 18
4.3 Class Diagram 19
4.4 Activity Diagram 20
4.5 Sequence Diagram 21
4.6 Entity Relationship Diagram 22
4.7 Logistic Regression 32
4.8 Random Forest Classifier 34
4.9 Decision Tree Classifier 35
4.10 Naïve Bayes Classifier 37
4.11 K-Nearest Neighbour 38
4.12 Support Vector Classifier 39
4.13 Gradient Boost 40
6.1 Machine Learning Algorithms Accuracy 50
6.2 Home Page 50
6.3 Inputs Page 51
6.4 Inputs Given By The User 51
6.5 Loan Approved 52
6.6 Loan Rejected 52

v
 CHAPTER-1
INTRODUCTION

1.1 OBJECTIVE OF THE PROJECT:

The goal is to develop a machine learning model for Bank Loan Approval
Prediction, to potentially replace the updatable supervised machine learning classification
models by predicting results in the form of best accuracy by comparing supervised
algorithm.

1.1.1 Necessity:
This online bank loan approval system helps in overcoming the
time management. This Application is very easy to use. It can work accurately and
very smoothly in a different scenario. It reduces the effort workload and increases
efficiency in work. In aspects of time value, it is worthy. In this website the user can
check the loan status easily whether approved or not.

1.1.2 Software development method:

In many software applications program different methods and
cases are followed such as, Waterfall model, Iterative model, Spiral model, V-model
and Big Bang model. I used waterfall model in this application. I tried to use test
case and case software approaches.

1.1.3 Layout of the document:

This documentation starts with formal introduction. After
introduction analysis and design of the project are described. In analysis and
design of the project have many parts such as project proposal, mission, goal,
target audience, environment. Use cases and test cases are in chapter 2 and
chapter 3 respectively. Finally, this documentation finished with result and
Conclusion part.

1
1.2 OVERVIEW OF THE DESIGNED PROJECT:
At first, we take the dataset from out resource then we have to perform
data-preprocessing, visualization methods for cleaning and visualizing the dataset
respectively and we applied the Machine Learning algorithms on the dataset then we
generate the pickle file for best algorithm and flask is used as user interface for displaying
the result.

2
 CHAPTER-2
LITERATURE SURVEY

2.1 LITERATURE SURVEY:

General
A literature review is a body of text that aims to review the critical points of current
knowledge on and/or methodological approaches to a particular topic. It is secondary
sources and discuss published information in a particular subject area and sometimes
information in a particular subject area within a certain time period. Its ultimate goal is to
bring the reader up to date with current literature on a topic and forms the basis for another
goal, such as future research that may be needed in the area and precedes a research
proposal and may be just a simple summary of sources. Usually, it has an organizational
pattern and combines both summary and synthesis.
A summary is a recap of important information about the source, but a synthesis is a re-
organization, reshuffling of information. It might give a new interpretation of old material
or combine new with old interpretations or it might trace the intellectual progression of the
field, including major debates. Depending on the situation, the literature review may
evaluate the sources and advise the reader on the most pertinent or relevant of them.

Review of Literature Survey

Title : A benchmark of machine learning approaches for credit score prediction.
Author: Vincenzo Moscato, Antonio Picariello, Giancarlo Sperlí
Year : 2021
Credit risk assessment plays a key role for correctly supporting financial institutes in
defining their bank policies and commercial strategies. Over the last decade, the emerging
of social lending platforms has disrupted traditional services for credit risk assessment.
Through these platforms, lenders and borrowers can easily interact among them without
any involvement of financial institutes. In particular, they support borrowers in the
fundraising process, enabling the participation of any number and size of lenders.
However, the lack of lenders’ experience and missing or uncertain information about

3
borrower’s credit history can increase risks in social lending platforms, requiring an
accurate credit risk scoring. To overcome such issues, the credit risk assessment problem
of financial operations is usually modeled as a binary problem on the basis of debt’s
repayment and proper machine learning techniques can be consequently exploited. In this
paper, we propose a benchmarking study of some of the most used credit risk scoring
models to predict if a loan will be repaid in a P2P platform. We deal with a class imbalance
problem and leverage several classifiers among the most used in the literature, which are
based on different sampling techniques. A real social lending platform (Lending Club)
data-set, composed by 877,956 samples, has been used to perform the experimental
analysis considering different evaluation metrics (i.e. AUC, Sensitivity, Specificity), also
comparing the obtained outcomes with respect to the state-of-the-art approaches. Finally,
the three best approaches have also been evaluated in terms of their explainability by
means of different eXplainable Artificial Intelligence (XAI) tools.

Title : An Approach for Prediction of Loan approval using Machine Learning Algorithm.
Author: Mohammad Ahmad Sheikh, Amit Kumar Goel, Tapas Kumar
Year : 2020
In our banking system, banks have many products to sell but main source of income of
any banks is on its credit line. So they can earn from interest of those loans which they
credits.A bank’s profit or a loss depends to a large extent on loans i.e. whether the
customers are paying back the loan or defaulting. By predicting the loan defaulters, the
bank can reduce its NonPerforming Assets. This makes the study of this phenomenon
very important. Pre vious research in this era has shown that there are so many methods
to study the problem of controlling loan default. But as the right predictions are very
important for the maximization of profits, it is essential to study the nature of the different
methods and their comparison. A very important approach in predictive analytics is used
to study the problem of predicting loan defaulters: The Logistic regression model. The
data is collected from the Kaggle for studying and prediction. Logistic Regression models
have been performed and the different measures of performances are computed. The
models are compared on the basis of the performance measures such as sensitivity and

4
specificity. The final results have shown that the model produce different results.Model is
marginally better because it includes variables (personal attributes of customer like age,
purpose, credit history, credit amount, credit duration, etc.) other than checking account
information (which shows wealth of a customer) that should be taken into account to
calculate the probability of default on loan correctly. Therefore, by using a logistic
regression approach, the right customers to be targeted for granting loan can be easily
detected by evaluating their likelihood of default on loan. The model concludes that a bank
should not only target the rich customers for granting loan but it should assess the other
attributes of a customer as well which play a very important part in credit granting
decisions and predicting the loan defaulters.

Title : Predict Loan Approval in Banking System Machine Learning Approach for
Cooperative Banks Loan Approval.
Author: Amruta S. Aphale, Dr. Sandeep R. Shinde.
Year : 2020
In today’s world, taking loans from financial institutions has become a very common
phenomenon. Everyday a large number of people make application for loans, for a variety
of purposes. But all these applicants are not reliable and everyone cannot be approved.
Every year, we read about a number of cases where people do not repay bulk of the loan
amount to the banks due to which they suffers huge losses. The risk associated with
making a decision on loan approval is immense. So the idea of this project is to gather
loan data from multiple data sources and use various machine learning algorithms on this
data to extract important information. This model can be used by the organizations in
making the right decision to approve or reject the loan request of the customers. In this
paper, we examine a real bank credit data and conduct several machine learning
algorithms on the data for that determine credit worthiness of customers in order to
formulate bank risk automated system.

Title : Loan Approval Prediction Using Machine Learning

Author: Yash Divate, Prashant Rana, Pratik Chavan

5
Year : 2021
With the upgrade in the financial area loads of individuals are applying for bank advances
however the bank has its restricted resources which it needs to allow to restricted
individuals just, so discovering to whom the credit can be conceded which will be a more
secure choice for the bank is a commonplace interaction. So in this task we attempt to
decrease this danger factor behind choosing the protected individual in order to save
bunches of bank endeavors and resources. This is finished by mining the Data of the past
records of individuals to whom the advance was conceded previously and based on these
records/encounters the machine was prepared utilizing the AI model which give the most
precise outcome. The principle objective of this paper is to anticipate whether relegating
the advance to specific individual will be protected or not. This paper is separated into four
areas (i)Data Collection (ii) Comparison of AI models on gathered information (iii) Training
of framework on most encouraging model (iv) Testing.

Title : Prediction for Loan Approval using Machine Learning Algorithm

Author: Ashwini S. Kadam, Shraddha R. Nikam, Ankita A. Aher, Gayatri V. Shelke,Amar
S. Chandgude
Year : 2021
In our banking system, banks have many products to sell but main source of income of
any banks is on its credit line. So they can earn from interest of those loans which they
credits. A bank’s profit or a loss depends to a large extent on loans i.e. whether the
customers are paying back the loan or defaulting. By predicting the loan defaulters, the
bank can reduce its Non-performing Assets. This makes the study of this phenomenon
very important. Previous research in this era has shown that there are so many methods
to study the problem of controlling loan default. But as the right predictions are very
important for the maximization of profits, it is essential to study the nature of the different
methods and their comparison. A very important approach in predictive analytics is used
to study the problem of predicting loan defaulters (i) Collection of Data, (ii) Data Cleaning
and (iii) Performance Evaluation. Experimental tests found that the Naïve Bayes model
has better performance than other models in terms of loan forecasting.

6
Title : Modern Approach for Loan Sanctioning in Banks Using Machine Learning
Author: Golak Bihari Rath, Debasish Das, BiswaRanjan Acharya
Year : 2021
Loan analysis is a process adopted by banks used to check the credibility of loan
applicants who can pay back the sanction loan amount within regulations and loan amount
term mentioned by the bank. Most banks use their common recommended procedure of
credit scoring and background check techniques to analyze the loan application and to
make decisions on loan approval. This is overall a risk-oriented and a time-consuming
process. In some cases, people suffer through financial problems while some intentionally
try to fraud. As a result, such delay and default in payment by the loan applicants can lead
to loss of capital of the banks. Hence to overcome this, banks need to adopt a better
procedure to find the trustworthy applicants for granting loan from the list of all applicants
applied for the loan, who can pay can their loan amount in stipulated time. In the modern-
day age and advance of technology, we adopt a machine learning approach to reduce the
risk factor and human errors in the loan sanction process and determine where an
applicant is eligible for loan approval or not. Here, we examine various features such as
applicant income, credit history, education from past records of loan applicants
irrespective of their loan sanction, and the best features are determined and selected
which have a direct impact on the outcome for loan approval.

7
 CHAPTER-3
AIM AND SCOPE OF THE PRESENT INVESTIGATION

3.1 PROJECT PROPOSAL:

The project proposal is the term of documents. A project can describe

the project proposal. It is the set of all plans of a project. Like, how the software works,
what are the steps to complete the entire projects, and what are the software requirements
and analysis for this project. In my project, I am doing all the steps and also risk and
reward and other project dependencies in the project proposal.

3.1.1 Mission:
An online Web based machine learning application is very popular
and well known to everyone. Now a day’s everybody wants to get it and work with
it. Loan prediction is mostly useful for bank employees in approving the loan
application. This simple method gives fast and accurate results in approving the
customer application.
3.1.2 Goal:
The goal is to develop a machine learning model for Bank Loan
Approval Prediction.

3.2 SCOPE OF THE PROJECT:

The scope of this paper is to implement and investigate how different
supervised binary classification methods impact default prediction. The model evaluation
techniques used in this project are limited to precision, sensitivity, F1-score.

3.3 OVERVIEW OF THE PROJECT:

The overview of the project is to provide a web-based machine learning
application to the user. Therefore, the user can directly check the loan approval in our
website over the internet. So, the user can easily check into this loan system prediction
whether their loan will be approved or not.

8
3.4 EXISTING SYSTEM:
Anomaly detection relies on individuals’ behavior profiling and works by
detecting any deviation from the norm. When used for online banking fraud detection,
however, it mainly suffers from three disadvantages. First, for an individual, the
historical behavior data are often too limited to profile his/her behavior pattern. Second,
due to the heterogeneous nature of transaction data, there lacks a uniform treatment
of different kinds of attribute values, which becomes a potential barrier for model
development and further usage.
Third, the transaction data are highly skewed, and it becomes a challenge to
utilize the label information effectively. Anomaly detection often suffers from poor
generalization ability and a high false alarm rate. We argue that individuals’ limited
historical data for behavior profiling and the highly skewed nature of fraud data could
account for this defect. Since it is straightforward to use information from other similar
individuals, measuring similarity itself becomes a great challenge due to heterogeneous
attribute values. We propose to transform the anomaly detection problem into a
pseudo-recommender system problem and solve it with an embedding based method.
By doing so, the idea of collaborative filtering is implicitly used to utilize information from
similar users, and the learned preference matrices and attribute embedding provide a
concise way for further usage.

3.4.1 Disadvantages:
1. They had proposed a mathematical model and machine learning
algorithms is not used.
2. Class Imbalance problem was not addressed and the proper measure
were not taken.

3.5 PREPARING THE DATASET:

This dataset contains 665 records of features extracted from Bank Loan datas, which
were then classified into 2 classes:

• Approve
• Reject

9
3.6 PROPOSED SYSTEM:

3.6.1 Exploratory Data Analysis of loan approval

Multiple datasets from different sources would be combined to form a
generalized dataset, and then different machine learning algorithms would be
applied to extract patterns and to obtain results with maximum accuracy.

3.6.2 Data Wrangling

In this section of the report will load in the data, check for cleanliness,
and then trim and clean given dataset for analysis. Make sure that the
document steps carefully and justify for cleaning decisions.

3.6.3 Data collection

The data set collected for predicting given data is split into Training set
and Test set. Generally, 7:3 ratios are applied to split the Training set and Test
set. The Data Model which was created using machine learning algorithms are
applied on the Training set and based on the test result accuracy, Test set
prediction is done.

3.6.4 Building the classification model

The predicting the loan approval, ML algorithm prediction model is
effective because of the following reasons: It provides better results in
classification problem.
➢ It is strong in preprocessing outliers, irrelevant variables, and a mix of
continuous, categorical and discrete variables.
➢ It produces out of bag estimate error which has proven to be unbiased in
many tests and it is relatively easy to tune with.

10
Bank Loan Dataset

Data Processing Test

dataset

Classification ML Model
Training Algorithm
dataset

Fig:3.1: Architecture of Proposed model

3.6.5 Advantages:
➢ Performance and accuracy of the algorithms can be calculated and
compared.
➢ Class imbalance can be dealt with machine learning approaches.

11
3.8 FLOW CHART:

Fig:3.2: FLOW CHART

12
 CHAPTER-4
EXPERIMENTAL OR MATERIALS AND METHODS
ALGORITHMS USED

4.1 SYSTEM STUDY:

To develop this model we use new modern technologies which are
Machine Learning using Python for predicting and Flask is for user interface.

4.1.1 System requirement specifications:

a) Hardware requirements:
▪ Processor : Intel
▪ RAM : 2GB
▪ Hard Disk : 80GB
b) Software requirements:
▪ OS : Windows
▪ Framework : Flask
▪ Technology : Machine Learning using Python
▪ Web Browser : Chrome, Microsoft Edge
▪ Code editor : Visual Studio Code, Google Colab,
Anaconda or Jupyter notebook.

4.2 SYSTEM SPECIFICATIONS:

4.2.1 Machine Learning Overview:
Machine learning is a field of study that looks at using
computational algorithms to turn empirical data into usable models. The machine
learning field grew out of traditional statistics and artificial intelligences
communities. Through their business processes immense amounts of data have
been and will be collected. This has provided an opportunity to re-invigorate the
statistical and computational approaches to autogenerate useful models from
data. Machine learning algorithms can be used to (a) gather understanding of the
cyber phenomenon that produced the data under study, (b) abstract the

13
 understanding of underlying phenomena in the form of a model, (c) predict future
values of a phenomena using the above-generated model, and (d) detect
anomalous behavior exhibited by a phenomenon under observation.

4.2.2 Flask Overview:

Flask is an API of Python that allows us to build up web-

applications. It was developed by Armin Ronacher. Flask's framework is more
explicit than Django's framework and is also easier to learn because it has less
base code to implement a simple web-Application.

4.3 STEPS TO DOWNLOAD & INSTALL PYTHON:

Download the Latest version of the Python executable installer
(https://www.python.org/downloads/). Watch the PIP list where pip is the package
installer for python. Now upgrade the pip and setuptools using the command

Pip install --upgrade pip and Pip install --upgrade setuptools

4.3.1 IDE INSTALLATION FOR PYTHON

IDE stands for Integrated Development Environment. It is a GUI
(Graphical User Interface) where programmers write their code and produce
the final products. Best IDE is Pycharm. So download the pycharm new
version and install the software
(https://www.jetbrains.com/pycharm/download/)

4.3.2 PYTHON FILE CREATION

GO To FILE MENU > CREATE > NEW > PYTHON FILE
>(Name Your Python File as “HOUSE PRICE PPREDICTION” > SAVE

4.4 PYTHON LIBRARIES NEEDED

There are many libraries in python. In those we only use few main
libraries needed.

14
4.4.1 NUMPY LIBRARY
NumPy is an open-source numerical Python library. NumPy contains
a multi- dimensional array and matrix data structures. It can be utilized to
perform a number of mathematical operations on arrays such as
trigonometric, statistical, and algebraic routines like mean, mode, standard
deviation etc…,

Installation- (https://numpy.org/install/)

pip install NUMPY

Here we mainly use array, to find mean and standard deviation.

4.4.2 PANDAS LIBRARY

Pandas is a high-level data manipulation tool developed by Wes
McKinney. It is built on the Numpy package and its key data structure is called the
DataFrame. DataFrames allow you to store and manipulate tabular data in rows
of observations and columns of variables. There are several ways to create a
DataFrame.
Installation- (https://pandas.pydata.org/getting_started.html)

pip install PANDAS

Here we use pandas for reading the csv files, for grouping the data, for cleaning
the data using some operations.

4.4.3 MATPLOTLIB LIBRARY

Matplotlib is a comprehensive library for creating static, animated,
and interactive visualizations in Python. Matplotlib makes easy things easy and
hard things possible. Use interactive figures that can zoom, pan, update, visualize
etc.,
Installation- (https://matplotlib.org/users/installing.html)

15
pip install Matplotlib

Here we use pyplot mainly for plotting graphs.

matplotlib.pyplot is a collection of functions that make matplotlib work like
MATLAB. Each pyplot function makes some change to a figure: e.g., creates a
figure, creates a plotting area in a figure, plots some lines in a plotting area,
decorates the plot with labels, etc.

4.4.4 SEABRON LIBRARY

Seaborn package was developed based on the Matplotlib library.
It is used to create more attractive and informative statistical graphics. While
seaborn is a different package, it can also be used to develop the attractiveness
of matplotlib graphics.
Installation-(https://seaborn.pydata.org/installing.html)

pip install Seaborn

4.4.5 SCIKIT-LEARN LIBRARY

Scikit-learn is a free machine learning library for the Python. It
features various algorithms like support vector machine, random forests,
regression and k-neighbors, and it also supports Python numerical and
scientific libraries like NumPy and SciPy.

Pip install Scikit-Learn

Installation-(https://scikit-learn.org/stable/install.html)

Here use scikit-learn’s regression methods for prediction purpose.

4.4.6 FLASK
Flask is an API of Python that allows us to build up web-
applications. It was developed by Armin Ronacher. Flask's framework is more

16
 explicit than Django's framework and is also easier to learn because it has
less base code to implement a simple web-Application.

pip install flask

Here we use flask for the user-interface.

4.5 MODULES:
A modular design reduces complexity, facilities change (a critical aspect of
software maintainability), and results in easier implementation by encouraging parallel
development of different part of system. Software with effective modularity is easier to
develop because function may be compartmentalized and interfaces are simplified.
Software architecture embodies modularity that is software is divided into separately
named and addressable components called modules that are integrated to satisfy problem
requirements.
Modularity is the single attribute of software that allows a program to be intellectually
manageable. The five important criteria that enable us to evaluate a design method with
respect to its ability to define an effective modular design are: Modular decomposability,
Modular Comps ability, Modular Understand ability, Modular continuity, Modular
Protection.

17
 Fig:4.1: SYSTEM ARCHITECTURE

4.6 UML DIAGRAMS

4.6.1 Use Case Diagram

Fig:4.2: USE CASE DIAGRAM

18
 Use case diagrams are considered for high level requirement
analysis of a system. So when the requirements of a system are analyzed the
functionalities are captured in use cases. So, it can say that uses cases are
nothing but the system functionalities written in an organized manner.

4.6.2 Class Diagram

Fig:4.3: CLASS DIAGRAM

Class diagram is basically a graphical representation of the static

view of the system and represents different aspects of the application. So a
collection of class diagrams represent the whole system. The name of the class
diagram should be meaningful to describe the aspect of the system. Each
element and their relationships should be identified in advance Responsibility
(attributes and methods) of each class should be clearly identified for each
class minimum number of properties should be specified and because,
unnecessary properties will make the diagram complicated. Use notes
whenever required to describe some aspect of the diagram and at the end of
the drawing it should be understandable to the developer/coder. Finally, before
making the final version, the diagram should be drawn on plain paper and
rework as many times as possible to make it correct.

19
 4.6.3 Activity Diagram

Fig:4.4: ACTIVITY DIAGRAM

Activity is a particular operation of the system. Activity diagrams are
not only used for visualizing dynamic nature of a system but they are also used
to construct the executable system by using forward and reverse engineering
techniques. The only missing thing in activity diagram is the message part. It
does not show any message flow from one activity to another. Activity diagram
is some time considered as the flow chart. Although the diagrams looks like a
flow chart but it is not. It shows different flow like parallel, branched, concurrent
and single.

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 4.6.4 Sequence Diagram

Fig:4.5: SEQUENCE DIAGRAM

Sequence diagrams model the flow of logic within your system in a

visual manner, enabling you both to document and validate your logic, and are
commonly used for both analysis and design purposes. Sequence diagrams
are the most popular UML artifact for dynamic modeling, which focuses on
identifying the behavior within your system. Other dynamic modeling
techniques include activity diagramming, communication diagramming, timing
diagramming, and interaction overview diagramming. Sequence diagrams,
along with class diagrams and physical data models are in my opinion the
most important design-level models for modern business application
development.

21
4.6.5 Entity Relationship Diagram (ERD)

Fig:4.6: ENTITY RELATIONSHIP DIAGRAM

An entity relationship diagram (ERD), also known as an entity

relationship model, is a graphical representation of an information system that
depicts the relationships among people, objects, places, concepts or events
within that system. An ERD is a data modelling technique that can help define
business processes and be used as the foundation for a relational database.
Entity relationship diagrams provide a visual starting point for database design
that can also be used to help determine information system requirements
throughout an organization. After a relational database is rolled out, an ERD
can still serve as a referral point, should any debugging or business process
re-engineering be needed later.

The following are the modules of the project, which is planned in aid
to complete the project with respect to the proposed system, while overcoming
existing system and also providing the support for the future enhancement.

22
4.7 MODULE DETAILS:
4.7.1 Data Pre-processing
Validation techniques in machine learning are used to get the error rate
of the Machine Learning (ML) model, which can be considered as close to the true
error rate of the dataset. If the data volume is large enough to be representative
of the population, you may not need the validation techniques. However, in real-
world scenarios, to work with samples of data that may not be a true
representative of the population of given dataset. To finding the missing value,
duplicate value and description of data type whether it is float variable or integer.
The sample of data used to provide an unbiased evaluation of a model fit on the
training dataset while tuning model hyper parameters.
The evaluation becomes more biased as skill on the validation dataset
is incorporated into the model configuration. The validation set is used to evaluate
a given model, but this is for frequent evaluation. It as machine learning engineers
use this data to fine-tune the model hyper parameters. Data collection, data
analysis, and the process of addressing data content, quality, and structure can
add up to a time-consuming to-do list. During the process of data identification, it
helps to understand your data and its properties; this knowledge will help you
choose which algorithm to use to build your model.
A number of different data cleaning tasks using Python Pandas library
and specifically, it focuses on probably the biggest data cleaning task, missing
values and it able to more quickly clean data. It wants to spend less time cleaning
data, and more time exploring and modeling.
Some of these sources are just simple random mistakes. Other times,
there can be a deeper reason why data is missing. It’s important to understand
these different types of missing data from a statistics point of view. The type of
missing data will influence how to deal with filling in the missing values and to
detect missing values, and do some basic imputation and detailed statistical
approach for dealing with missing data. Before, joint into code, it’s important to
understand the sources of missing data. Here are some typical reasons why data
is missing:

23
 • User forgot to fill in a field.
• Data was lost while transferring manually from a legacy database.
• There was a programming error.
• Users chose not to fill out a field tied to their beliefs about how the results
would be used or interpreted.

Variable identification with Uni-variate, Bi-variate and Multi-variate analysis:

➢ import libraries for access and functional purpose & read the given dataset
➢ General Properties of Analyzing the given dataset
➢ Display the given dataset in the form of data frame
➢ show columns
➢ shape of the data frame
➢ To describe the data frame
➢ Checking data type and information about dataset
➢ Checking for duplicate data
➢ Checking Missing values of data frame
➢ Checking unique values of data frame
➢ Checking count values of data frame
➢ Rename and drop the given data frame
➢ To specify the type of values
➢ To create extra columns

4.7.2 Data Validation/ Cleaning/Preparing Process

Importing the library packages with loading given dataset. To analyzing
the variable identification by data shape, data type and evaluating the missing
values, duplicate values. A validation dataset is a sample of data held back from
training your model that is used to give an estimate of model skill while tuning
model's and procedures that you can use to make the best use of validation and
test datasets when evaluating your models. Data cleaning / preparing by rename
the given dataset and drop the column etc. to analyze the uni-variate, bi-variate
and multi-variate process.

24
 The steps and techniques for data cleaning will vary from dataset to dataset. The
primary goal of data cleaning is to detect and remove errors and anomalies to
increase the value of data in analytics and decision making.

MODULE DIAGRAM

GIVEN INPUT EXPECT OUTPUT

input: data
output: removing noisy data

4.7.3 Exploration data analysis of visualization

Data visualization is an important skill in applied statistics and machine
learning. Statistics does indeed focus on quantitative descriptions and estimations
of data. Data visualization provides an important suite of tools for gaining a
qualitative understanding. This can be helpful when exploring and getting to know a
dataset and can help with identifying patterns, corrupt data, outliers, and much more.
With a little domain knowledge, data visualizations can be used to express and
demonstrate key relationships in plots and charts that are more visceral and
stakeholders than measures of association or significance. Data visualization and
exploratory data analysis are whole fields themselves and it will recommend a
deeper dive into some the books mentioned at the end.
Sometimes data does not make sense until it can look at in a visual form, such as
with charts and plots. Being able to quickly visualize of data samples and others is
an important skill both in applied statistics and in applied machine learning. It will
discover the many types of plots that you will need to know when visualizing data in

25
Python and how to use them to better understand your own data.
➢ How to chart time series data with line plots and categorical quantities
with bar charts.
➢ How to summarize data distributions with histograms and box plots.

MODULE DIAGRAM

GIVEN INPUT EXPECT OUTPUT

input: data
output: visualized data

4.7.4 Comparing Algorithm with prediction in the form of best accuracy

result
It is important to compare the performance of multiple different machine
learning algorithms consistently and it will discover to create a test harness to
compare multiple different machine learning algorithms in Python with scikit-learn.
It can use this test harness as a template on your own machine learning problems
and add more and different algorithms to compare. Each model will have different
performance characteristics. Using resampling methods like cross validation, you
can get an estimate for how accurate each model may be on unseen data. It needs
to be able to use these estimates to choose one or two best models from the suite
of models that you have created. When have a new dataset, it is a good idea to
visualize the data using different techniques in order to look at the data from
different perspectives. The same idea applies to model selection. You should use
a number of different ways of looking at the estimated accuracy of your machine
learning algorithms in order to choose the one or two to finalize. A way to do this is
26
to use different visualization methods to show the average accuracy, variance and
other properties of the distribution of model accuracies.
In the next section you will discover exactly how you can do that in Python with
scikit-learn. The key to a fair comparison of machine learning algorithms is
ensuring that each algorithm is evaluated in the same way on the same data and
it can achieve this by forcing each algorithm to be evaluated on a consistent test
harness.
Pre-processing refers to the transformations applied to our data before
feeding it to the algorithm. Data Preprocessing is a technique that is used to
convert the raw data into a clean data set. In other words, whenever the data is
gathered from different sources it is collected in raw format which is not feasible
for the analysis. To achieving better results from the applied model in Machine
Learning method of the data has to be in a proper manner. Some specified
Machine Learning model needs information in a specified format, for example,
Random Forest algorithm does not support null values. Therefore, to execute
random forest algorithm null values have to be managed from the original raw
data set. And another aspect is that data set should be formatted in such a way
that more than one Machine Learning and Deep Learning algorithms are executed
in given dataset.
In the example below these 7 different algorithms are compared:
➢ Logistic Regression
➢ Random Forest
➢ Decision Tree Classifier
➢ Naïve Bayes
➢ Support Vector Classifier
➢ K Nearest Neighbor
➢ Gradient Boost

The K-fold cross validation procedure is used to evaluate each algorithm,

importantly configured with the same random seed to ensure that the same splits
to the training data are performed and that each algorithm is evaluated in precisely

27
the same way. Before that comparing algorithm, Building a Machine Learning
Model using install Scikit-Learn libraries. In this library package have to done
preprocessing, linear model with logistic regression method, cross validating by
KFold method, ensemble with random forest method and tree with decision tree
classifier. Additionally, splitting the train set and test set. To predicting the result
by comparing accuracy.

False Positives (FP): A person who will pay predicted as defaulter. When actual
class is no and predicted class is yes. E.g. if actual class says this passenger did
not survive but predicted class tells you that this passenger will survive.
False Negatives (FN): A person who default predicted as payer. When actual
class is yes but predicted class in no. E.g. if actual class value indicates that this
passenger survived and predicted class tells you that passenger will die.
True Positives (TP): A person who will not pay predicted as defaulter. These are
the correctly predicted positive values which means that the value of actual class
is yes and the value of predicted class is also yes. E.g. if actual class value
indicates that this passenger survived and predicted class tells you the same
thing.
True Negatives (TN): A person who default predicted as payer. These are the
correctly predicted negative values which means that the value of actual class is
no and value of predicted class is also no. E.g. if actual class says this passenger
did not survive and predicted class tells you the same thing.

Prediction result by accuracy:

Logistic regression algorithm also uses a linear equation with independent
predictors to predict a value. The predicted value can be anywhere between
negative infinity to positive infinity. It needs the output of the algorithm to be
classified variable data. Higher accuracy predicting result is logistic regression
model by comparing the best accuracy.

28
True Positive Rate (TPR) = TP / (TP + FN)
False Positive Rate (FPR) = FP / (FP + TN)

Accuracy: The Proportion of the total number of predictions that is correct

otherwise overall how often the model predicts correctly defaulters and non-
defaulters.

Accuracy calculation:
Accuracy = (TP + TN) / (TP + TN + FP + FN)
Accuracy is the most intuitive performance measure and it is simply a ratio of
correctly predicted observation to the total observations. One may think that, if we
have high accuracy then our model is best. Yes, accuracy is a great measure but
only when you have symmetric datasets where values of false positive and false
negatives are almost same.

Precision: The proportion of positive predictions that are actually correct.

Precision = TP / (TP + FP)
Precision is the ratio of correctly predicted positive observations to the total
predicted positive observations. The question that this metric answer is of all
passengers that labeled as survived, how many actually survived? High precision
relates to the low false positive rate. We have got 0.788 precision which is pretty
good.

Recall: The proportion of positive observed values correctly predicted. (The

proportion of actual defaulters that the model will correctly predict)
Recall = TP / (TP + FN)
Recall (Sensitivity) - Recall is the ratio of correctly predicted positive observations
to the all observations in actual class - yes.

F1 Score is the weighted average of Precision and Recall. Therefore, this score
takes both false positives and false negatives into account. Intuitively it is not as

29
easy to understand as accuracy, but F1 is usually more useful than accuracy,
especially if you have an uneven class distribution. Accuracy works best if false
positives and false negatives have similar cost. If the cost of false positives and
false negatives are very different, it’s better to look at both Precision and Recall.

General Formula:
F- Measure = 2TP / (2TP + FP + FN)
F1-Score Formula:
F1 Score = 2*(Recall * Precision) / (Recall + Precision)

4.7.5 ALGORITHM AND TECHNIQUES

Algorithm Explanation
In machine learning and statistics, classification is a supervised learning approach
in which the computer program learns from the data input given to it and then uses
this learning to classify new observation. This data set may simply be bi-class (like
identifying whether the person is male or female or that the mail is spam or non-
spam) or it may be multi-class too. Some examples of classification problems are:
speech recognition, handwriting recognition, bio metric identification, document
classification etc. In Supervised Learning, algorithms learn from labeled data.
After understanding the data, the algorithm determines which label should be
given to new data based on pattern and associating the patterns to the unlabeled
new data.

Used Python Packages:

sklearn:
• In python, sklearn is a machine learning package which include a lot of ML
algorithms.
• Here, we are using some of its modules like train_test_split,
DecisionTreeClassifier or Logistic Regression and accuracy_score.

30
NumPy:
• It is a numeric python module which provides fast maths functions for
calculations.
• It is used to read data in numpy arrays and for manipulation purpose.
Pandas:
• Used to read and write different files.
• Data manipulation can be done easily with data frames.

Matplotlib:
• Data visualization is a useful way to help with identify the patterns from given
dataset.
• Data manipulation can be done easily with data frames.

Logistic Regression:
It is a statistical method for analyzing a data set in which there are one or more
independent variables that determine an outcome. The outcome is measured with
a dichotomous variable (in which there are only two possible outcomes). The goal
of logistic regression is to find the best fitting model to describe the relationship
between the dichotomous characteristic of interest (dependent variable =
response or outcome variable) and a set of independent (predictor or explanatory)
variables. Logistic regression is a Machine Learning classification algorithm that
is used to predict the probability of a categorical dependent variable. In logistic
regression, the dependent variable is a binary variable that contains data coded
as 1 (yes, success, etc.) or 0 (no, failure, etc.).

In other words, the logistic regression model predicts P(Y=1) as a function of X.

Logistic regression Assumptions:
➢ Binary logistic regression requires the dependent variable to be binary.
➢ For a binary regression, the factor level 1 of the dependent variable should
represent the desired outcome.

31
 ➢ Only the meaningful variables should be included.
➢ The independent variables should be independent of each other. That is,
the model should have little.
➢ The independent variables are linearly related to the log odds.
➢ Logistic regression requires quite large sample sizes.

MODULE DIAGRAM

Fig:4.7: LOGISTIC REGRESSION

GIVEN INPUT EXPECT OUTPUT

input: data
output: getting accuracy

32
Random Forest Classifier:
Random forests or random decision forests are an ensemble learning method for
classification, regression and other tasks, that operate by constructing a multitude
of decision trees at training time and outputting the class that is the mode of the
classes (classification) or mean prediction (regression) of the individual
trees. Random decision forests correct for decision trees’ habit of over fitting to
their training set. Random forest is a type of supervised machine learning
algorithm based on ensemble learning. Ensemble learning is a type of learning
where you join different types of algorithms or same algorithm multiple times to
form a more powerful prediction model. The random forest algorithm combines
multiple algorithm of the same type i.e. multiple decision trees, resulting in a forest
of trees, hence the name "Random Forest". The random forest algorithm can be
used for both regression and classification tasks.
The following are the basic steps involved in performing the random forest
algorithm:
➢ Pick N random records from the dataset.
➢ Build a decision tree based on these N records.
➢ Choose the number of trees you want in your algorithm and repeat steps
1 and 2.
In case of a regression problem, for a new record, each tree in the forest predicts
a value for Y (output). The final value can be calculated by taking the average of
all the values predicted by all the trees in forest. Or, in case of a classification
problem, each tree in the forest predicts the category to which the new record
belongs. Finally, the new record is assigned to the category that wins the majority
vote.

33
 Fig:4.8: RANDOM FOREST CLASSIFIER

GIVEN INPUT EXPECT OUTPUT

input: data
output: getting accuracy

Decision Tree Classifier:

It is one of the most powerful and popular algorithm. Decision-tree algorithm falls
under the category of supervised learning algorithms. It works for both continuous
as well as categorical output variables. Assumptions of Decision tree:
➢ At the beginning, we consider the whole training set as the root.
➢ Attributes are assumed to be categorical for information gain, attributes
are assumed to be continuous.
➢ On the basis of attribute values records are distributed recursively.
➢ We use statistical methods for ordering attributes as root or internal
node.
Decision tree builds classification or regression models in the form of a tree
structure. It breaks down a data set into smaller and smaller subsets while at the

34
same time an associated decision tree is incrementally developed. A decision
node has two or more branches and a leaf node represents a classification or
decision. The topmost decision node in a tree which corresponds to the best
predictor called root node. Decision trees can handle both categorical and
numerical data. Decision tree builds classification or regression models in the form
of a tree structure. It utilizes an if-then rule set which is mutually exclusive and
exhaustive for classification. The rules are learned sequentially using the training
data one at a time. Each time a rule is learned, the tuples covered by the rules
are removed. This process is continued on the training set until meeting a
termination condition. It is constructed in a top-down recursive divide-and-conquer
manner. All the attributes should be categorical. Otherwise, they should be
discretized in advance. Attributes in the top of the tree have more impact towards
in the classification and they are identified using the information gain concept. A
decision tree can be easily over-fitted generating too many branches and may
reflect anomalies due to noise or outliers.

Fig:4.9: DECISION TREE CLASSIFIER

35
Naive Bayes algorithm:
The Naive Bayes algorithm is an intuitive method that uses the probabilities of
each attribute belonging to each class to make a prediction. It is the supervised
learning approach you would come up with if you wanted to model a predictive
modeling problem probabilistically.
➢ Naive bayes simplifies the calculation of probabilities by assuming that
the probability of each attribute belonging to a given class value is
independent of all other attributes. This is a strong assumption but results
in a fast and effective method.
➢ The probability of a class value given a value of an attribute is called the
conditional probability. By multiplying the conditional probabilities together
for each attribute for a given class value, we have a probability of a data
instance belonging to that class. To make a prediction we can calculate
probabilities of the instance belonging to each class and select the class
value with the highest probability.
➢ Naive Bayes is a statistical classification technique based on Bayes
Theorem. It is one of the simplest supervised learning algorithms. Naive
Bayes classifier is the fast, accurate and reliable algorithm. Naive Bayes
classifiers have high accuracy and speed on large datasets.
➢ Naive Bayes classifier assumes that the effect of a particular feature in a
class is independent of other features. For example, a loan applicant is
desirable or not depending on his/her income, previous loan and
transaction history, age, and location.
➢ Even if these features are interdependent, these features are still
considered independently. This assumption simplifies computation, and
that's why it is considered as naive. This assumption is called class
conditional independence.

36
 Fig:4.10: NAÏVE BAYES CLASSIFIER

K-Nearest Neighbor
K-Nearest Neighbor is one of the simplest Machine Learning algorithms based on
Supervised Learning technique. It assumes the similarity between the new
case/data and available cases and put the new case into the category that is most
similar to the available categories. It stores all the available data and classifies a
new data point based on the similarity. This means when new data appears then
it can be easily classified into a well suite category by using K- NN algorithm. K-
NN algorithm can be used for Regression as well as for Classification but mostly
it is used for the Classification problems.

37
 Fig:4.11: K-NEAREST NEIGHBOR

Support Vector Classifier

Support Vector Classifier or SVC is one of the most popular Supervised Learning
algorithms, which is used for Classification as well as Regression problems.
Primarily, it is used for Classification problems in Machine Learning. The goal of
the SVC algorithm is to create the best line or decision boundary that can
segregate n-dimensional space into classes. So that we can easily put the new
data point in the correct category in the future. This best decision boundary is
called a hyperplane. SVC chooses the extreme points/vectors that help in creating
the hyperplane. These extreme cases are called as support vectors, and hence
algorithm is termed as Support Vector Machine.

38
 Fig:4.12: SUPPORT VECTOR CLASSIFIER

Gradient Boost
Gradient boosting algorithm is one of the most powerful algorithms in the field of
machine learning. As we know that the errors in machine learning algorithms are
broadly classified into two categories i.e., Bias Error and Variance Error. As
gradient boosting is one of the boosting algorithms it is used to minimize bias error
of the model.
Gradient boosting algorithm can be used for predicting not only continuous target
variable (as a Regressor) but also categorical target variable (as a Classifier).

39
 Fig:4.13: GRADIENT BOOST

4.7.6 Deployment Using Flask (Web Framework):

Flask is a micro web framework written in Python. It is classified as a
micro-framework because it does not require particular tools or libraries. It has no
database abstraction layer, form validation, or any other components where pre-
existing third-party libraries provide common functions. However, Flask supports
extensions that can add application features as if they were implemented in Flask
itself.
Extensions exist for object-relational mappers, form validation, upload handling,
various open authentication technologies and several common framework related
tools.
Flask was created by Armin Ronacher of Pocoo, an international group of Python

40
enthusiasts formed in 2004. According to Ronacher, the idea was originally
an April Fool’s joke that was popular enough to make into a serious
application. The name is a play on the earlier Bottle framework.
When Ronacher and Georg Brand created a bulletin board system written in
Python, the Pocoo projects Werkzeug and Jinja were developed.
In April 2016, the Pocoo team was disbanded and development of Flask and
related libraries passed to the newly formed Pallets project.
Flask has become popular among Python enthusiasts. As of October 2020, it has
second most stars on GitHub among Python web-development frameworks, only
slightly behind Django, and was voted the most popular web framework in the
Python Developers Survey 2018.
The micro-framework Flask is part of the Pallets Projects, and based on several
others of them.

Flask is based on Werkzeug, Jinja2 and inspired by Sinatra Ruby framework,

available under BSD licence. It was developed at pocoo by Armin Ronacher.
Although Flask is rather young compared to most Python frameworks, it holds a
great promise and has already gained popularity among Python web developers.
Let’s take a closer look into Flask, so-called “micro” framework for Python.
MODULE DIAGRAM

GIVEN INPUT EXPECTED OUTPUT

input : data values
output : predicting output

41
 CHAPTER-5
RESULTS AND DISCUSSION, PERFORMANCE ANALYSIS

5.1 PERFORMANCE ANALYSIS:

Website performance optimization, the focal point of technologically
superior website designs is the primary factor dictating success for Loan approval
process. After all, unimpressive website performance kills admission process when the
torture of waiting for slow Web pages to load frustrates visitors into seeking alternatives
– impatience is a digital virtue! And also the ml algorithms used in our project will give
the best accurate result to the user for Loan approval.
We created the following six chapter in-depth speed optimization guide
to show you how important it is to have a fast loading, snappy website! Countless
research papers and benchmarks prove that optimizing your sites’ speed is one of the
most affordable and highest ROI providing investments!
Lightning-fast page load speed amplifies visitor engagement,
retention, and boosts sales. Instantaneous website response leads to higher conversion
rates, and every 1 second delay in page load decreases customer satisfaction by 16
percent, page views by 11 percent and conversion rates by 7 percent according to a
recent Aberdeen Group research.

5.2 DISCUSSION:
While discussions provide avenues for exploration and discovery,
leading a discussion can be anxiety-producing: discussions are, by their nature,
unpredictable, and require us as instructors to surrender a certain degree of control over
the flow of information. Fortunately, careful planning can help us ensure that discussions
are lively without being chaotic and exploratory without losing focus. When planning a
discussion, it is helpful to consider not only cognitive, but also social/emotional, and
physical factors that can either foster or inhibit the productive exchange of ideas.

42
 CHAPTER-6
SUMMARY AND CONCLUSION

6.1 SUMMARY:
This project objective is to predict the Loan Approval of the user. So this
online banking loan approval system will reduce the paper work and reduce the wastage
of bank asserts and efforts and also saves the valuable time of the customer.

6.2 CONCLUSION:
The analytical process started from data cleaning and processing,
missing value, exploratory analysis and finally model building and evaluation. The best
accuracy on public test set is higher accuracy score will be find out. This application can
help to find the Prediction of Bank Loan Approval.

6.3 FUTURE WORK:

• Bank Loan Approval prediction to connect with cloud.
• To optimize the work to implement in Artificial Intelligence environment.

43
REFERENCES:
[1] Amruta S. Aphale , Dr. Sandeep R. Shinde, 2020, Predict Loan Approval in
Banking System Machine Learning Approach for Cooperative Banks Loan
Approval, International Journal Of Engineering Research & Technology (IJERT)
Volume 09, Issue 08 (August 2020)
[2] Ashwini S. Kadam, Shraddha R. Nikam, Ankita A. Aher, Gayatri V. Shelke, Amar
S.Chandgude, “Prediction for Loan Approval using Machine Learning Algorithm”
(IRJET) Volume: 08 Issue: 04 | Apr 2021.
[3] M. A. Sheikh, A. K. Goel and T. Kumar, "An Approach for Prediction of Loan
Approval using Machine Learning Algorithm," 2020 International Conference on
Electronics and Sustainable Communication Systems (ICESC), 2020, pp. 490-
494, doi: 10.1109/ICESC48915.2020.9155614.
[4] Rath, Golak & Das, Debasish & Acharya, Biswaranjan. (2021). Modern Approach
for Loan Sanctioning in Banks Using Machine Learning. Pages={179-188}
10.1007/978-981-15-5243-4_15.
[5] Vincenzo Moscato, Antonio Picariello, Giancarlo Sperlí, A benchmark of machine
learning approaches for credit score prediction, Expert Systems with Applications,
Volume 165, 2021, 113986, ISSN 0957-4174.
[6] Yash Divate, Prashant Rana, Pratik Chavan, “Loan Approval Prediction Using
Machine Learning” International Research Journal of Engineering and
Technology (IRJET) Volume: 08 Issue: 05 | May 2021.

44
APPENDIX:
A. SOURCE CODE:
Jupyter Notebook
import numpy as np
import pandas as pd
import matplotlib.pyplot as plt
import missingno as mso
import seaborn as sns

from sklearn.model_selection import train_test_split

from imblearn.over_sampling import SMOTE

from sklearn.linear_model import LogisticRegression

from sklearn.neighbors import KNeighborsClassifier
from sklearn.svm import SVC
from sklearn.naive_bayes import GaussianNB
from sklearn.tree import DecisionTreeClassifier
from sklearn.ensemble import RandomForestClassifier
from sklearn.ensemble import GradientBoostingClassifier

df=pd.read_csv("Loan_Train.csv")
df.head()

countMale = len(df[df.Gender == 'Male'])

countFemale = len(df[df.Gender == 'Female'])
countNull = len(df[df.Gender.isnull()])

print("Percentage of Male applicant: {:.2f}%".format((countMale /

(len(df.Gender))*100)))
print("Percentage of Female applicant: {:.2f}%".format((countFemale /
(len(df.Gender))*100)))
print("Missing values percentage: {:.2f}%".format((countNull /
(len(df.Gender))*100)))

df.Married.value_counts(dropna=False)
sns.countplot(x="Married", data=df, palette="Paired")
plt.show()

df = pd.get_dummies(df)
df = df.drop(['Gender_Female', 'Married_No', 'Education_Not Graduate',
'Self_Employed_No', 'Loan_Status_N'], axis = 1)

Q1 = df.quantile(0.25)
Q3 = df.quantile(0.75)
IQR = Q3 - Q1

45
df = df[~((df < (Q1 - 1.5 * IQR)) |(df > (Q3 + 1.5 * IQR))).any(axis=1)]
X_train, X_test, y_train, y_test = train_test_split(X, y, test_size = 0.2,
random_state = 0)

LRclassifier = LogisticRegression(solver='saga', max_iter=500, random_state=1)

LRclassifier.fit(X_train, y_train)
y_pred = LRclassifier.predict(X_test)

scoreListknn = []
for i in range(1,21):
KNclassifier = KNeighborsClassifier(n_neighbors = i)
KNclassifier.fit(X_train, y_train)
scoreListknn.append(KNclassifier.score(X_test, y_test))

SVCclassifier = SVC(kernel='rbf', max_iter=500)

SVCclassifier.fit(X_train, y_train)
y_pred = SVCclassifier.predict(X_test)

NBclassifier2 = GaussianNB()
NBclassifier2.fit(X_train, y_train)
y_pred = NBclassifier2.predict(X_test)

scoreListDT = []
for i in range(2,21):
DTclassifier = DecisionTreeClassifier(max_leaf_nodes=i)
DTclassifier.fit(X_train, y_train)
scoreListDT.append(DTclassifier.score(X_test, y_test))

scoreListRF = []
for i in range(2,25):
RFclassifier = RandomForestClassifier(n_estimators = 1000, random_state =
1, max_leaf_nodes=i)
RFclassifier.fit(X_train, y_train)
scoreListRF.append(RFclassifier.score(X_test, y_test))

GBclassifier = GradientBoostingClassifier(subsample=1, n_estimators=200,

max_depth=5, max_leaf_nodes=40)
GBclassifier.fit(X_train, y_train)
y_pred = GBclassifier.predict(X_test)

compare = pd.DataFrame({'Model': ['Logistic Regression', 'Random Forest','K

Neighbors','Decision Tree','SVM','Gaussian NB','Gradient Boost'],'Accuracy':
[LRAcc*100,RFAcc*100, KNAcc*100, DTAcc*100, SVCAcc*100,
NBAcc2*100,GBAcc*100]})
compare.sort_values(by='Accuracy', ascending=False)

46
import pickle
file=open("RFclassifier.pkl", 'wb')
pickle.dump(RFclassifier, file)

Html pages source code:

Index.html
<!doctype html>
<html lang="en">
<head><title>loan Prediction</title></head><body>
<span class="block xl:inline">Loan Prediction</span>
<span class="block text-indigo-600 xl:inline">Machine Learning </span>
</h1><p class="mt-3 text-base text-gray-500 sm:mt-5 sm:text-lg sm:max-
w-xl sm:mx-auto md:mt-5 md:text-xl lg:mx-0">Stay Ahead of time and find out
now with ML powered predictions and it helps in knowing that if you are
Eligible or Not for taking loan.</p><div class="mt-5 sm:mt-8 sm:flex
sm:justify-center lg:justify-start"><div class="rounded-md shadow"><a
href="./predict" class="w-full flex items-center justify-center px-8 py-3
border border-transparent text-base font-medium rounded-md text-white bg-
indigo-600 hover:bg-indigo-700 md:py-4 md:text-lg md:px-
10">Prediction</a></div></div></div>
</body></html>

Predict.html
<!doctype html>
<html lang="en">
<head><title>prediction</title></head><body>
<section class="text-gray-600 body-font"><div class="container px-5 py-24
mx-auto"><div class="flex flex-col text-center w-full mb-20">
<h1 class="sm:text-3xl text-2xl font-medium title-font mb-4 text-gray-
900">Loan prediction</h1><p class="lg:w-2/3 mx-auto leading-relaxed text-
base">fill the form for prediction</p></div><div> </div>
<a class="btn btn-primary" href="./" role="button">Back</a>
</br></br> <form action='/predict' method='POST'><div class="mb-3">
<label for="exampleFormControlInput1" class="form-label"> Gender</label>
<select class="form-select" id="gender" name="gender" aria-label="Default
select example"><option selected>-- select gender --</option>
<option value="Male">Male</option><option value="Female">Female</option>
</select></div><div class="mb-3">
<label for="exampleFormControlInput1" class="form-label">Enter
ApplicantIncome</label><input type="text" class="form-control"
id="ApplicantIncome" name="ApplicantIncome" placeholder="ApplicantIncome">
</div></div><button type="submit" class="btn btn-primary">Predict</button>
</form></div></section>
</body></html>

47
LA. Html (Loan Approval):
<!DOCTYPE html>
<html lang="en">
<head>
</style><title>Loan Approval</title>
</head>
<body>
<div class="bg-image"></div>
<div class="bg-text">
<div class="col-md-6 my-2 d-flex align-items-end justify-content-
around"> <a href="/predict">
<button type="submit" class="btn btn-danger button"
style="margin-right: 100%;">Back</button></a>
</div>
<h1>LOAN STATUS</h1>
<p>You Will Get the Approval from the Bank </p>
</div>
</body>
</html>

LR. Html (Loan Reject):

<!DOCTYPE html>
<html lang="en">
<head>
-webkit-filter: blur(3px);height: 100%;
background-position: center;
background-repeat: no-repeat;
background-size: cover;
</style>
<title>Loan Reject</title>
</head>
<body>
<div class="bg-image"></div>

<div class="bg-text">
<div class="col-md-6 my-2 d-flex align-items-end justify-content-
around">
<a href="/predict"> <button type="submit" class="btn btn-danger
button" style="margin-right: 100%;">Back</button></a>
</div>
<h1>LOAN STATUS</h1>
<p>Your Details are not satisfed For Loan Approval</p>
</div></body>
</html>

48
App.py:
from flask import Flask, escape, request, render_template
import pickle
import numpy as np
app = Flask(__name__)
model = pickle.load(open('RFclassifier.pkl', 'rb'))
@app.route('/')
def home():
return render_template("index.html")
@app.route('/predict', methods=['GET', 'POST'])
def predict():
if request.method == 'POST':
gender = request.form['gender'] married = request.form['married']
dependents = request.form['dependents']
education = request.form['education']
self_employed = request.form['employed']
credit = float(request.form['credit'])area = request.form['area']
ApplicantIncome = float(request.form['ApplicantIncome'])
CoapplicantIncome = float(request.form['CoapplicantIncome'])
LoanAmount = float(request.form['LoanAmount'])
Loan_Amount_Term = float(request.form['Loan_Amount_Term'])
if (gender == "Male"):
Gender_Male=1
else:
Gender_Male=0
if(married=="Yes"):
Married_Yes = 1
else:
Married_Yes=0
if(dependents=='1'):
dependents_0 = 0
dependents_1 = 1
arr=np.array([[credit, ApplicantIncome, CoapplicantIncome, LoanAmount,
Loan_Amount_Term, Gender_Male, Married_Yes, dependents_0, dependents_1,
dependents_2, dependents_3, education_graduate, self_employed_yes,semiurban,
urban, rural ]])
prediction = model.predict(arr)
if(prediction==0):
return render_template("LR.html")
elif(prediction!=0):
return render_template("LA.html")
else:
return render_template("prediction.html")
if __name__ == "__main__":
app.run(debug=True)

49
B. SCREENSHOTS

Fig:6.1: MACHINE LEARNING ALGORITHMS ACCURACY

Fig:6.2: HOME PAGE

50
 Fig:6.3: INPUTS PAGE

Fig:6.4: INPUTS GIVEN BY THE USER

51
Fig:6.5: LOAN APPROVED

Fig:6.6: LOAN REJECTED

52
 Bank loan approval research
paper (1).docx
by Bank Loan Approval Research Paper (1).docx Bank Loan Approval
Research Paper (1).docx

Submission date: 28-Jan-2022 04:44PM (UTC+1000)

Submission ID: 1749835604
File name: Bank_loan_approval_research_paper_1.docx (474.98K)
Word count: 2360
Character count: 13597
 3

1
4
2
Bank loan approval research paper (1).docx
ORIGINALITY REPORT

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www.ijitee.org
Internet Source 1%
2
Submitted to University of Central Lancashire
Student Paper 1%
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essay.utwente.nl
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