Lewis Loans is a company offering unsecured borrowing of up to £25,000 for a range of purposes, from car finance to home improvements and from holidays to wedding costs. The loans are on offer to anyone with a reasonable credit rating. The company expects a default rate of around 3% on their loans and this is taken into account when calculating the interest that all borrowers at Lewis Loans are paying as a form of built-in insurance against the expected level of defaults.
Over the previous few months, Lewis Loans has noticed a slow yet steady increase in the numbers of borrowers who are late on their monthly payments or falling behind on their payments altogether. Their analysts decide to study the credit rating of these customers. Their findings indicate a clear trend of decline in the credit rating of their customers who are falling behind with their regular payments. Most of these have such a low credit rating that were they to apply for a loan now, they would have been turned down.
Extrapolating from these findings, they analyse their entire customer base and decide to contact all customers whose credit rating has significantly fallen below their original credit score when they were granted the loan. Using advanced data segmentation tools (such as those available from Noetica), they are able to create targeted lists of customers who may be considered at risk of default. The contact centre then deploys the full power of Noetica’s SmartBound dialler to contact these customers and discuss their specific circumstances.
By identifying such customers who may not yet have fallen behind with their payments, but were considered at risk of doing so, holding a conversation with them on a human level and being able to offer affordable solutions to the ones needing them, Lewis Loans manage to perform a double feat. First and foremost they manage to prevent a loan default rate higher than their 3% limit. This ensured their survival against strong market headwinds.
More than that, they managed to create a reputation as a responsible lender that cares about its customer base and as a result managed to grow the business further by acquiring valuable new customers at a time when their competitors are shrinking or worse. This was enabled by their visionary approach and facilitated by using advanced data segmentation and outbound campaign management and dialling tools (such as those available from Noetica).