Customer Engagement I’d Like to Buy the World a Better Decision

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Sometimes when I look around, it seems as though all I see are the charred remains of terrible choices—and that’s before I’ve even left my kitchen. In business, it’s now been 30 years, yet Coca-Cola will NEVER live down their decision to launch New Coke. (Just Google “Worst Business Decisions Ever Made” if you don’t believe me.) We don’t even need to leave the soft drink industry to come up with a top 10 list of bad decisions. (Crystal Pepsi, anyone? How about this actual advertisement for 7-Up, which is literally the poster child of bad decisions?) Within the ultra-competitive automotive finance industry, lenders don’t have the benefit of being able to survive small-scale bad decisions, let alone titanic blunders like the ones I listed above. Even a series of “good-but-not-great” decisions is enough to put you out of business, simply due to the volume of rival financers who can... [Read More]

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Collections & Recovery Buying a Collections System – What Vendors Won’t Tell You #3

Collections system checklist

This is question #3 in your handy guide to shopping for a collections system. I’m offering 10 tips — things most vendors won’t tell you that are absolutely critical to selecting the right system. What’s required in the infrastructure build? The details of the underlying system infrastructure are critical to success, which is why the implementation lead should take time to uncover exactly what’s required in the infrastructure build of the collection platform. System performance, backup memory and recovery, hardware and software specifications, maintenance and other aspects should be discussed and analyzed. The hidden costs to watch out for here are the costs of additional environments. You’ll probably require environments for production, test and training. Each of these environments will have associated costs that should be flushed out. The disaster recovery plan you put in place will include additional costs as well. Consider a support arrangement with your software vendor... [Read More]

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Analytics & Optimization When Will Analytic Business Adoption Reach an Inflection Point?


I have a confession to make. And nothing that would make most of you shudder (except for my beloved marketing colleagues). When I tell people I work for FICO, I usually get a response like “can you fix my credit score?” And by the time I break into my economical 30-second elevator pitch fit for cocktail parties, describing that we do more than scores, they’re already mingling with someone else. But recently, I had a conversation that evolved beyond the 580s and 820s of the credit scoring world. At a party, I chatted with someone who actually stuck around for my “what I do” story and confessed to knowing that FICO is in the analytics business. We talked about the difference between predictive and prescriptive analytics, the cumulative effect of business actions (such as marketing offers) on consumers, and even into the business value of an occasional fraud false positive.... [Read More]

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Collections & Recovery Demand for Electronic Payments Is Outpacing Technology Adoption

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The rise of electronic and mobile payment methods has been well documented in the payments industry in recent times, but what has been the driving force behind this? Dave Yohe, VP of Marketing at BillingTree, explains how consumer demand is having an effect on the types of new technology lending organizations are offering their customers.   Dave Yohe, BillingTree Consumer demand and technology is changing the way lenders are doing business. A recent BillingTree webinar, reviewing the findings of the 2015 Consumer Finance Business Strategy and Technology survey, looked at the adoption of payment technologies in small and large vendors. Bank-deposited paper checks were still higher on the list of customers’ payment methods than electronic or mobile payments – but that gap is closing. Paper still popular 85% of those surveyed said they still process bank-deposited paper checks – a more popular method with the older generation as they are... [Read More]

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Customer Engagement Video: Keeping Auto Lending Return on Equity High

Auto lender video - Matt Stanley 2 featured

Alternative deal structures are the key to more successful auto lending. In this video, Matt Stanley, analytic segment leader at FICO, discusses how he has been working with auto lenders to close more deals by offering more financing options. The structure delivers flexibility while maintaining high-quality decision making. Alternative deal structures allow for variability in the loan-to-value (LTV) or term, not only keeping the return on assets/equity thresholds in place for the lender, but also helping borrowers get the car they desire.

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Fraud & Security How Tunisian Banks Will Fight Money Laundering – in the Cloud

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Anti-money laundering is one of the vital components of the fight against organized crime and terrorism. Two firms have just received a FICO Decision Management Award for their innovative work to help banks across Tunisia increase their AML activities and comply with banking regulations. VITALIS, in partnership with FICO, has developed and deployed an advanced AML solution, hosted by SIBTEL in its cloud to be used by banks across Tunisia. In order to help the nation’s banks comply with AML regulations, SIBTEL sought a solution that could be installed in the cloud as a managed service. The solution VITALIS set up with them integrates the Siron® Anti-Financial Crime Solutions Suite from FICO TONBELLER, the Dow Jones Watchlist for screening PEP (politically exposed persons) and the VITALIS solution for managing Swift archives. The solution was implemented with a team of two consultants in just three months. This demonstrates the flexibility of... [Read More]

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Collections & Recovery Buying a Collections System – What Vendors Won’t Tell You #2

Collectins system shopping basket

This is question 2 in your handy guide to shopping for a collections system. I’m offering 10 tips — things most vendors won’t tell you that are absolutely critical to selecting the right system. 2. What reports do I get? How can I create reports myself? No two firms want the same exact reports package, and no two software companies offer the same reports. To meet the exact needs of your existing clients and to ensure the new system meets all other reporting requirements, identify the specific information required for each report, frequency of publication and other significant criteria. The requirements for each report should be carefully reviewed and documented. Vendors will offer reports that look similar to existing reports. Your job is to make sure they use the same data and produce the same results. This effort includes what vendors have written, “canned” reports that come with the system, and... [Read More]

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Fraud & Security APAC Banks Say 2016 Brings “Monkey Business” – Data Breaches

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In two weeks, the Chinese New Year brings us the Year of the Monkey. Why is this important? Well, according to Chinese Five Elements Horoscopes, Monkey contains metal and water. Metal is connected to gold. Water is connected to wisdom and danger. Therefore, we will deal with more risky financial events in 2016. As if to prove this point, at last month’s FICO Fraud Forum, every single attendee said they thought harm would come in the form of data breaches in other industries this year. 38 percent of respondents from 18 leading APAC banks ranked large retailers as being at the greatest risk for a data breach, with another 35 percent of respondents choosing telecommunications companies. Just like the monkey, criminals are smart, naughty, wily and vigilant animals. So, banks in the region are keenly aware of the threat posed by the increasingly connected business landscape. FSI card portfolios are... [Read More]

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Collections & Recovery Buying a Collections System – What Vendors Won’t Tell You #1

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Buying a new collections system isn’t like buying a car. It isn’t fun. But it does have something in common with buying a car. The people selling the system may not be telling you everything you need to know. For example, some vendors offer free licenses, giving you the impression the cost of the new system is much lower than another provider with a higher up-front cost. The reality is that after just a short time period, custom programming, integrations, transaction costs, maintenance and support fees turn the low up-front cost into a distant memory, followed by years of dramatically bigger monthly costs. There are lots of resources available to help car-shoppers know what to ask. We thought it would be useful to give you a 10-point checklist for buying a collections system. I’m going to help you ask the questions that give you the ability to accurately compare systems... [Read More]

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Customer Engagement What Does Best-in-Class Credit Originations Look Like?

Best Credit Originations

In an earlier blog post, I asked whether your credit originations was good, better or best, citing three common scenarios we see in global customer deployments: Good – All geographies standardized on a single solution, with each country or region customizing its own environment. Better – Following the 80-20 rule, each geography or region uses an environment that’s 80% standardized and 20% customizable to local requirements and practices. Best – Standardized credit application and decisioning across all geographies, with certain variables configurable to address market or regulatory conditions specific to each country or region. In this post, I’ll break down exactly what “best” means and share real-world examples of each of these three scenarios. Balancing global management and local flexibility The diagram below illustrates the combination of stability and flexibility that is common in successful originations operations, across industries and around the world. As you can see, the decision structure... [Read More]

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