Diagnose a Structural Break in KYC Submission Rate

Question

This question asks the candidate to diagnose a structural break in the KYC (Know Your Customer) submission rate, analyzing data to identify trends and anomalies.

Codemia · Accepted Answer

To diagnose a structural break in the KYC submission rate, I would first define what a structural break is in this context. A structural break refers to a significant change in the relationship between variables over time, which can affect the submission rate of KYC documents. Understanding this concept is crucial as it helps identify when and why the submission rate may have deviated from expected patterns.

I would start by analyzing the data from the provided tables: sessions, signup, and merchant. My first step would be to calculate the overall signup rate for the 2023 cohort by joining the sessions and signup tables. This involves filtering the data for the relevant cohort and counting the number of signups against the total sessions. The SQL query might look like this:

```sql
SELECT COUNT(s.id) AS signup_count, COUNT(se.id) AS total_sessions
FROM sessions se
JOIN signup s ON se.user_id = s.user_id
WHERE se.date >= '2023-01-01' AND se.date < '2024-01-01';
```

This will give me the overall signup rate for the cohort.

Once I have the overall signup rate, I would analyze the data over time to identify any significant shifts. I would look at trends in the KYC submission rate month by month and use statistical tests, such as Chow Test, to formally test for structural breaks. Additionally, I would consider external factors such as changes in regulations, product features, or marketing strategies that could have impacted user behavior.

After identifying any structural breaks, I would discuss the implications of these findings. For example, if the submission rate dropped significantly after a new feature was introduced, it may indicate user confusion or dissatisfaction. I would suggest conducting user interviews or surveys to gather qualitative data that could explain the quantitative findings. This holistic approach ensures that we not only understand the 'what' but also the 'why' behind the trends.

In summary, diagnosing a structural break in KYC submission rates involves a combination of quantitative analysis using SQL and qualitative insights from user feedback. By employing a structured approach, I can provide actionable recommendations to enhance the KYC process and improve submission rates.

Diagnose a Structural Break in KYC Submission Rate

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