The debt collection process is laborious and time-consuming, requiring detailed analysis and in-depth knowledge. This process has been transformed in the last decade, partly due to a more demanding, competitive and uncertain environment and the incorporation of new tools to optimise debt collections to increase efficiency and productivity. While some delays may be minor, other situations may require delegating the task to specialised professionals equipped with the right tool to carry out optimised and effective recovery strategies to prevent the process from getting bogged down.

The most recent available data reveals that the default ratio of the Financial Credit Institutions (EFC), the consumer credit providers, was 6.35% in October last year. This ratio is nearly twice the default rate recorded in loans granted by banks to households and businesses. The latter recorded its best rate since December 2008, standing at 3.77% in the ninth month of 2020. A report commissioned by the National Association of Financial Establishments (Asnef) and prepared by consultancy firm PwC showed that EFCs provided financing amounting to €60,733 million in 2021.

GDS Modellica has developed Artificial Intelligence (AI) software to enhance collection management. This solution can be applied at every stage of the risk process, including intake/origination, customer management, fraud prevention, collections, and regulatory compliance, with tailored solutions for each aspect. According to the consultancy, integrating AI in credit recovery has undoubtedly enhanced the structure, strategies, and overall recovery process. Through the analysis of debtor data, AI identifies behaviour patterns and recommends the most effective communication channels to create a positive touchpoint. Intelligent management optimises debt recovery, resulting in cost-effective time, operations, technology, human resources, and customer relations productivity.