CARDS & PAYMENTS | Staff Reporter, Singapore

APAC banks plan to use automated collections systems by 2019

Seven in 10 banks intend to utilise AI to streamline bill payments.

Seven in 10 (70%) banks in the Asia Pacific are planning to implement automated, AI-powered collections systems within the next two years, according to a survey from FICO.

Almost half (46%) plan to integrate AI into their banking systems in 2018 whilst another 24% are set on doing this by 2019.

Banks believe that AI-powered analytics can help them optimise collections (48%), whilst 41% believe that it will lead to more accurate prediction of consumer behaviour.

“Lenders understand that they need the tools that allow them to stop relying on gut-feel decisions or out-of-date models, and collections is a key area where AI has the potential to improve business decisions as well as the customer experience,” said FICO Asia-Pacific president Dan McConaghy.

Automation is also set to streamline contact strategy settings and ensuring that agents perform debt restructuring or calculate provision rates in accordance with the IFRS 9.

Eight in 10 (81%) of respondents also believe automated collections leads to higher customer satisfaction. Avoiding the embarrassment of dealing with an agent was seen as the key reason (52%), with the convenience of being contacted proactively coming second (31%) and a reminder when they have forgotten a bill coming third (29%)

“We believe that Customer Communication Services has a lot to offer late-stage collections,” added McConaghy. “Automated collections helps to reduce the number of customers that end up in these late stages through early intervention with early contact strategies that work. Now with the addition of AI, we are also seeing significant improvements in minimising roll rates across credit card portfolios.

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