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Collection Analytic Building Blocks

FICO ™ Forum: Debt Manager ™ 9 User Group. Fairfax, VA | June 4–5, 1014. Collection Analytic Building Blocks. Mary Du Pont Principal Consultant, Fair Isaac Advisors FICO. The Building Blocks of Collection Analytics The Data and Tools Needed to Perform the Analysis Questions.

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Collection Analytic Building Blocks

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  1. FICO™ Forum: Debt Manager™ 9 User Group Fairfax, VA | June 4–5, 1014 Collection Analytic Building Blocks Mary Du Pont Principal Consultant, Fair Isaac Advisors FICO

  2. The Building Blocks of Collection Analytics • The Data and Tools Needed to Perform the Analysis • Questions

  3. Building Blocks of Collection Strategy • Use of RPC toobtain promises • To increase promises and reduce roll • Most effective use of Calls to get RPC • To increase RPC • Most effective use of Dialer and Collector hour to make calls • To increase calls

  4. Dialer Effectiveness • Use of RPC toobtain promises • Dialer Reports—Per dialer hour effectiveness- make the best use of the dialer • Call Handling Time—Per dialer hour effectiveness- Use the least time per call • Most effective use of Calls to get RPC • RPC Rate by Time and Day—Call at the right time • Most effective use of Dialer and Collector hour to make calls

  5. Where to Call

  6. Collector Effectiveness • Focus on call handling time • Contact AND No Contact • Study by call disposition • Set disposition level standards • Study by workgroup • Do not mix del levels

  7. Dialer/Collector Effectiveness • Resource as denominator • System hour • Collector hour • Accounts

  8. Call Effectiveness • Use of RPC toobtain promises • Account Level Penetration Study—Know when to stop call and move to different treatment • Monthly Penetration Rate Study—Cease calls when penetration no longer increases RPC • Most effective use of Calls to get RPC • RPC Prediction—Call accounts likely to be RPC • When to start calling • Most effective use of Dialer and Collector hour to make calls

  9. Managing Calling Resources • Strategy Questions • When to start calling • collection entry strategy • When/where to call • RPC rates • How often per day to call • Penetration rates • When to stop calling and try something else • When the odds of reaching the customer on the next call falls below threshold • Strategy Answer • Begin calls at 42 days delinquent • Best time to call is mobile afternoons • 2 attempts per day on weekdays • Stop predictive calling by day 93 when RPC rate drops below 2% For Every Account!

  10. When to Start Calling • When the roll rate is above x

  11. When and Where to Call • RPC analysis to predict which accounts (not call patterns) have greater odds of RPC • Does risk band correlate to contact rate? • New characteristics uncovered that can be used in to further improve segmentation • Days since last customer transaction or Worst cycle in the last 12 months • Count of months delinquent in last 12 months • Customer age—Under 25 population has 400 basis point diff from 25-35

  12. When and Where to Call

  13. When and Where to Call

  14. Call Efficiency • How often per day to call • RPC rates are highest in early days and early passes • Over 25% of all contact occurs on first pass on first day • Over 40% of all right party contact occurs on first pass on first day

  15. How Many Time to Call • If there are 28 days to call, how many do you need to try before it is time to give up? ✓ ✓ ✓ ✓ ✓

  16. Call Efficiency • When to stop calling and try something else • Once 50% of week hours have been called, there is 60% probability of “No Contact”

  17. Call Efficiency • Once 40% of week hours have been called, there is >60% probability of “No Contact”

  18. RPC Effectiveness • Most effective use of RPC • RPC/Non RPC Roll Rate Analysis—Which RPC events change rolls and by how much? • Most effective Use of RPC • Most effective Use of Dialer and collector hour

  19. Measuring Call Effectiveness • She was going to pay anyway! • This customer will pay if you can help him understand how/when • This customer wont pay even if they come to the phone!

  20. The Value of Contact • Roll Rate discerns the value of RPC • Typically there are very high and very low risk accounts for whom RPC has little value (change in behavior) • Requires granular risk segmentation

  21. What Tools are Needed? • Scores!! • No analysis can be interpreted correctly without risk based segmentation • Scores can be behavior scores, roll rate scores, or payment projection scores • Data which captures collection and dialer activity • DM9 data • Roll event • Cycle based data is best especially in high volume bucket one

  22. Summary • Ask the right (simple) questions • One question at a time • In the right order • Use the data you have

  23. FICO™ Forum: Debt Manager™ 9 User Group Fairfax, VA | June 4–5, 1014 Thank You Mary Du Pont847-308-8492marydupont@fico.com

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