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As consumer credit continues to tighten and the economy maintains its downward trajectory, lenders, including credit card issuers, are faced with more delinquent customers. To combat this trend, some industry experts suggest companies use "preemptive collection," a strategy that attempts to identify and contact at-risk clients before payments become delinquent. "The concept of preemptive risk management is all about finding problem customers before they become obvious," Tom Miller, senior vice president of Austin Logistics Inc., which provides risk mitigation and collection data, said last week during a panel discussion at SourceMedia's Financial Services Collections Conference in Las Vegas. "From an analytics perspective, what that means is having the ability to distinguish good and bad customers as accurately and quickly as you possibly can," Miller said. Lenders that use data and technology to preemptively address high-risk accounts avoid having delinquent clients and improve customer loyalty, the panel agreed. However, suggesting to a customer that he is on the road to delinquency can be a risky proposition, said Vytas Kisielius, CEO of Collections Marketing Center, a collections services company. Lenders want to protect themselves and help their customer, but they risk offending and losing that customer. "You need to find out information about them in a way that's the least invasive as possible," Kisielius said.
