White Paper 13, Techniques for Federated Analysis

Open Risk White Paper 13: Federated Credit Systems, Part II: Techniques for Federated Data Analysis

In this Open Risk White Paper, the second of series focusing on Federated Credit Systems, we explore techniques for federated credit data analysis. Building on the first paper where we outlined the overall architecture, essential actors and information flows underlying various business models of credit provision, in this step we focus on the enabling arrangements and techniques for building Federated Credit Data Systems and enabling Federated Analysis.

We start with a brief and non-technical description on privacy-preserving technologies, focusing on the special role of federated analysis within the spectrum of cryptographic approaches to multi-party computation. We then discuss generative processes of credit data that both motivate federated analysis uses cases and shape its specific characteristics in the context of the financial sector. We proceed to define the concept of a federated credit data system, with the federated master data table as an iconic outcome. Building on that layout we sketch how generic algorithms might be structured in a federated analysis context, giving examples from concentration risk analysis. We conclude with thoughts on the potential challenges to realize and benefit from federated systems in finance.


OpenRiskWP13_200323 PDF

Source Code


 author = {P. Papadopoulos},
 year = {2023},
 note = {\href{https://www.openriskmanagement.com/wp-content/uploads/2023/03/OpenRiskWP13_200323.pdf}{Download URL}},
 title = {{Open risk WP13: Federated Credit Systems, Part II: Techniques for Federated Data Analysis}},
 journal = {Open Risk White Papers}