Predictive modelling & Customer Lifetime Value
Experian's decision analytics expertise spans a variety of industries, including banking, utilities, telecommunications, leasing, insurance, automotive, mortgage, retail finance, public sector, mail order, small business and unsecured lending. Experian has developed best practice analytical, consulting and product capabilities to support organisations to manage and optimise:
Application scoring in the origination process is used to predict how a potential customer will behave in the future. With this information, decisions can be made about whether to accept or decline an applicant. This view of each individual can help develop a picture of the potential value of an accepted applicant, to inform decisions about the product and terms offered.
Behavioural scoring is used throughout the life of a customer relationship to inform management strategies for each customer, whether managing bad customers or extending the relationship with good customers. For organisations that have many relationships with their customers, customer-level scoring brings together the different aspects of the relationship into one complete picture.
Collections & Recoveries
Behavioural scoring is also used to prioritise collections activities to maximise recoveries and reduce collections costs. An understanding of the customer drives collections and debt recovery activity.
The Basel Capital Accord (Basel II) requires Financial Institutions to estimate Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EAD) for groups of exposures. Experian has helped many organisations around the world build estimates of PD, LGD and EAD and embed them in their business processes.