Consumer finance leaders, you’ve found your people!
Every month, Scott Hamilton hosts a monthly roundtable for consumer finance leaders only. He brings together an ever-growing number of to share best practices (and sometimes not-so-great ones - hey, it’s all learning!).
This month the group talked about account prioritization, specifically as it relates to propensity models.
Because in collections functions, whether you’re in banking, collections, fintech, and beyond, you’ve got limited resources. And that means you’ve got to focus on the accounts who are likely to pay.
If you missed the discussion (or just want to relive the magic), here are a few of the takeaways:
- A lot of teams still rely primarily on the basics of prioritization, like account and score histories.
- A twist on those basics comes when collections teams include other customer or account metrics they have access to, such as promise-to-pay history or contact success rates.
- One company Scott mentioned also incorporates other account activity, including click-throughs or website visits.
- Propensity models are not one-size fits all - first- or third-party, the type of business or debts, and account age affect mean the best model is a customized model.
- Incorporating third-party data is an important practice, but drawbacks are that it can be costly and models don’t get updated frequently (and those two things are related).
- A multi-channel approach that incorporates digital makes a huge difference (one participant said they’ve seen a double-digit reduction in losses), and a solid strategy (that same participant mentioned considering the day of the week for outreach, because they suspect outreach on Fridays is successful because it’s often payday).
Come to share or just to listen (no selling allowed!) - the best place to get the information you need is from your colleagues.