By: Wendy Greenawalt
Optimization has become a “buzz word” in the financial services marketplace, but some organizations still fail to realize all the possible business applications for optimization. As credit card lenders scramble to comply with the pending credit card legislation, optimization can be a quick and easily implemented solution that fits into current processes to ensure compliance with the new regulations.
Optimizing decisions
Specifically, lenders will now be under strict guidelines of when an APR can be changed on an existing account, and the specific circumstances under which the account must return to the original terms. Optimization can easily handle these constraints and identify which accounts should be modified based on historical account information and existing organizational policies.
APR account changes can require a great deal of internal resources to implement and monitor for on-going performance. Implementing an optimized strategy tree within an existing account management strategy will allow an organization to easily identify consumer level decisions. This can be accomplished while monitoring accounts through on-going batch processing.
New delivery options are now available for lenders to receive optimized strategies for decisions related to:
- Account acquisition
- Customer management
- Collections
Organizations who are not currently utilizing this technology within their processes should investigate the new delivery options. Recent research suggests optimizing decisions can provide an improvement of 7-to-16 percent over current processes.
