Survey: US Consumers Need Both Automated and Live Prompting on Late Payments

Customer Success
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Customer Development

SAN JOSE, Calif. — November 21, 2017

A new survey of consumer attitudes on lender communications by Silicon Valley analytics firm FICO found that even in this digital age, US consumers still expect a mix of automated and live communications with their creditors. Lenders cannot assume automated reminders alone would prompt all customers to take action effectively. They should optimize their automated communications strategy so that they can free up their call center resources to reach customers who respond better to a live caller.

Lenders have a new opportunity to reach customers faster using SMS. A third of respondents said they prefer SMS late payment reminders but only less than 15 percent of respondents receive one. However, lenders should clearly understand the functions and limitations of their mobile strategy. For example, mobile apps are still not consumers’ preferred method of making late payments (12 percent), despite the popularity of SMS as reminders.

In addition, live contacts continue to be important for some borrowers. More than a quarter (27 percent) of the respondents said they are more likely to respond to a live contact regarding a late payment than even a restructuring or reduction of their debt (8 percent).

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“Today’s mobile-first, digitally savvy borrowers expect friendly and helpful services from lenders on every channel,” said Tim VanTassel, vice president of FICO’s credit lifecycle business line. “US lenders have to strike a fine balance between automating their customer communications effectively without losing sight of the importance of live contacts for select borrowers to take action in order to boost repayments.”

The survey also found that:

  • Social media channels are inappropriate for late payment communication: Only eight percent of people in the US indicated that they would be comfortable receiving late payment reminders from their bank through social media channels or chat apps, even though a vast majority use them regularly.
  • Email is the most commonly used late payment reminder channel: Consumers are used to receiving late payment reminders by email with 36 percent selecting it as their top choice and 42 percent typically receiving email late-payment messages.
  • Websites or online portals were the preferred method of making late payments (31 percent), with phone calls a distant second (17 percent).

FICO surveyed 3,600 consumers, 18+ years of age, in nine countries around the globe between June and August 2017.

About FICO
FICO (NYSE: FICO) powers decisions that help people and businesses around the world prosper. Founded in 1956 and based in Silicon Valley, the company is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 180 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, telecommunications, health care, retail and many other industries. Using FICO solutions, businesses in more than 100 countries do everything from protecting 2.6 billion payment cards from fraud, to helping people get credit, to ensuring that millions of airplanes and rental cars are in the right place at the right time.

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Media Contact:
Leonora Fleming for FICO
Voce Communications

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