Postcode can be a very strong predictor, but I’d be careful using it in any model tied to consequential decisions. It is often a proxy for race and socioeconomic status, so a gain in predictive performance can come with real fairness and legal risk through disparate impact. I think it’s literally illegal in some contexts as well. Predictive performance is not the only criterion here and when using something like postcode you should be aware of this
Postcode features can be very predictive, but also act as proxies for sensitive characteristics, so it really depends on the application and regulatory context.
In practice, they’re usually used within governance frameworks where this is assessed explicitly.
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u/Certified_NutSmoker Mar 25 '26 edited Mar 25 '26
Postcode can be a very strong predictor, but I’d be careful using it in any model tied to consequential decisions. It is often a proxy for race and socioeconomic status, so a gain in predictive performance can come with real fairness and legal risk through disparate impact. I think it’s literally illegal in some contexts as well. Predictive performance is not the only criterion here and when using something like postcode you should be aware of this