02 Feb 2015

EQUIFAX EMPOWERS CREDITORS TO UNDERSTAND CUSTOMERS IN DEFAULT

Equifax is first-to-market with unique analysis to optimise collection strategies

Equifax, the consumer and business insights expert, has launched Equifax Recovery Insights, a solution providing unique analysis of customers’ behaviour once in default and helping organisations optimise their collection and recover strategies.

The data provided will allow in-house departments, debt collection agencies and purchasers to assess the likelihood of repayment and identify the most effective strategy to handle each account.

Equifax is marketing the solution to client groups including banks, utility providers, automotive financers and debt collectors and purchasers.

Paul Birks, Decision Solutions Director, Equifax, says: “The average personal debt per UK adult is £28,968*, and banks and building societies write off billions in loans every year. Gaining a deeper understanding of customers’ behaviour when they are in default helps creditors manage their resources efficiently, while equipping them with the in-depth knowledge required to treat customers fairly. We want to build confidence in debt collection by providing a solution that makes the entire process more transparent, easier to understand and more effective for all involved.”

The product allows businesses to build a clear picture of indebted customers, identifying which ones are more likely to make repayments and at what level. Effective profiling and segmentation can help creditors deal with customers in a fair way and meet regulatory requirements. The data, for example on whether an individual is paying off other debt and by what amount, can be used to create tailored payment plans for customers, based on what they can realistically afford. The solution saves businesses time and money by focusing their resources on debtors that are likely to make repayments, rather than pursuing those who genuinely cannot repay their debts.

Equifax Recovery Insights works by analysing customer data from banks, financial services companies, telcos, utilities and debt collection agencies. Characteristics and scores are then calculated based on post-default payment data of customers across all their defaulted debts, allowing companies to prioritise accounts and optimise recovery strategies based on what customers’ can afford to pay. The scores created using Recovery Insights are more effective than traditional scores at predicting how likely it is that an individual will make repayments on their defaulted debt. Traditional scores are often largely based on demographic data and don’t reflect an individual’s personal circumstances, which is key to understanding customers struggling with their debts.

* Figures as at November 2014. According to the Money Charity, http://themoneycharity.org.uk/money-statistics/