What is a Risk Assessment Matrix? A matrix is used as a analytic tool from which ideas originate and conclusions can be drawn. A risk assessment is used in different industries to analyze potential risks. Project coordinators use these kinds of matrix to determine risk and analyze how to proceed.
Many people a familiar with credit scores. Credit scores can be used as an ideal example to demonstrate what is a risk assessment looks like in the form of a matrix. A credit score is a risk assessment matrix used by corporations and banks to determine the level of risk a potential client carries when requesting a loan.
A risk assessment like a credit score is broken down into poor, fair, good, and excellent. Someone with a credit score that is in the poor category will be a higher risk. Therefore, a lender will charge a higher interest rate because of higher risk.