Reference:  Behavioural PD scoring model along with limit increase strategy implementation

“We grew too quickly. Now we do not have the human resources to manage our customers and risk. The line between profit and loss is very thin.”

Client’s CEO

Client need
Our client – a non-banking financial institution experienced significant exponential growth in the first two years on the market. Now a problem has emerged that money is distributed to the loan-holders but company’s human resource is not able to manage them properly. Furthermore, the support centre is suffering to target the right customers with their campaign and time and money is being progressively wasted.

Approach
A bespoke behavioural probability of default scoring model was developed. This, used as a stepping-stone, was integrated into a customer limit increase campaign management strategy.

Solution
A full behavioural risk profile was achieved with the scoring solution. Additionally, the up-sale limit increase strategy was based on the scoring solution and along with a couple of more criteria created an automated CRM tool. This increased highly both support centre effectiveness and efficiency.

The model

  • Great discriminative performance;
  • Enriched and reliable customer’s profile.

The campaign

  • Based on the scorecard;
  • Enhanced with other metrics like time-on-book and utilization ratio.

Benefits

  • Transparent and flexible solution
  • Increase in customers accepted the offer by 30% - efficiency;
  • Significant increase in the portfolio while managing the risk


Up-sale strategy