Optimized Collection Efforts

Improve Collections
and Optimize Efforts

Improve Collections and Optimize Efforts

The Challenge

The NBFC sector has undergone a significant transformation over the past few years and plays a significant role in the growth of any Financial system. NBFCs have outperformed banks across several product lines by carving out niche products. They are more customer focused and take the time to understand the customer behaviour and build customised products and reach out to different segments of customers with customised loans and customer friendly repayment plans and take higher risks. This however creates the challenges of debt collection. Debt collection is important for the company to improve their cash flow and in turn help businesses reduce the risks of incurring losses, and free up their resources.

About the Company

The Solution

CyborgIntell’s iTuring can be used to develop predictive models that identify customer default early in their lending journey. It can accurately forecast delinquency movement for the whole portfolio, across all customers and all buckets. The outputs of the default prediction models and their explanations around customer behavior can help define strategies to improve overall collection efforts and as a result improve portfolio.

The FinTech company we engaged with on Collection optimization was experiencing a default rate of ~12%. We used iTuring be build predictive models that predicted customer movements from one delinquency bucket to the next for pre-delinquency, early stage, late stage and recovery. iTuring developed accurate models which predicted default in the immediate next month with an accuracy of ~86%, enabling business to effectively manage portfolio monthly. This enabled the company to identify 9 customer segments based on probability of default and value at risk and develop collection strategies around the same.
By focusing efforts on 72% of likely defaulters that were identified in the top 30% customers the company would improve collections by 116%.




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Time to Deployment

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Why CyborgIntell

Not only does iTuring provide highly accurate predictions of which customers are likely to default, it also enables you to identify key customer segments for optimized collection strategies. This allows collections team to focus on the customers based on their likelihood of default, value at risk and probability of repayment, thereby improving overall debt collection.

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