Automatic rejection rate

The automatic rejection rate is the percentage of cases or transactions that are declined automatically by a system, without human intervention, much like a vigilant guardian who swiftly turns away unwelcome visitors. In various industries, such as finance, insurance, and e-commerce, automated systems are employed to assess the risk or legitimacy of transactions, applications, or requests. The automatic rejection rate reflects the proportion of these items deemed unacceptable based on predefined rules, criteria, or algorithms. Monitoring the automatic rejection rate can help organizations evaluate the effectiveness and accuracy of their automated processes and make adjustments as needed to maintain a balance between risk management and customer satisfaction.

Example

A lending company uses an automated system to screen loan applications based on factors such as credit score, debt-to-income ratio, and employment history. Applications that fail to meet certain thresholds or criteria are automatically rejected by the system. The automatic rejection rate represents the percentage of loan applications declined without human intervention. By tracking this rate, the lending company can identify trends, assess the system's performance, and refine its criteria or algorithms as needed to ensure a fair and efficient lending process while managing risk effectively.