Ulrich Wiesner

One of the repeating patterns of economic downturns is that banks task branch staff with collection calls. It may seem to be a good idea: branch staff typically have proximity to the customer, personal relationships and an understanding of the customer and regional circumstances. When the economy recovers, these reasons are quickly forgotten, and branch staff return t…

Around the world, governments and financial services providers are announcing payment holidays that help customers who have a cash crunch due to the pandemic. The latest of these is a scheme approved by the German Bundestag which became effective today. From April 1, 2020, it will be possible to have loan payments held for the next three months, and to only pay back t…

Debt restructures are an important tool to address financial hardship-change. The toolkit can include measures such as arrears capitalisation, term extension, interest reduction or even a haircut on the outstanding balance. When applied appropriately, a restructure serves both the debtor and the creditor. From a debtor perspective, the instalments become more affordab…

While analytic optimization can be used across the debt management cycle, collection treatment optimization is one of the best ways to get started. Through analytics, you can determine the ideal action to take on every account, as well as when to take it. Collection treatment optimization can also answer that vexing question, “Do we have too many collectors or not eno…

Here’s a real-life problem that illustrates the need for loan restructure optimization: I was in a management workshop on collections at an auto finance organization when a receptionist interrupted. “A customer we haven’t spoken to in two years,” she said, “is downstairs. He owes us $100,000. He has $80,000 in a suitcase, and says he can’t pay any more than that. What…

There’s a clear pecking order when it comes to the IFRS 9 accounting standard that goes into effect in January. It’s an accounting standard, not a piece of banking regulation, so the hierarchy is Finance, Risk and then Collections. This makes sense, but for debt managers it will cause problems. It’s likely that many debt managers will be blind next year on how they c…