Strategy & Operations

We take a look at what we mean by legacy tech and how cloud-based solutions can help financial institutions looking to transform

Harry Singh, SVP of Global Decisioning discusses how synthetic and alternative data can help lenders navigate the current credit risk challenges

Check out the latest business headlines from Global Decision Analytics, covering digital identification, digital-first and lenders in a post-pandemic world

As we enter the beginning of the end of this global crisis, the role of data, analytics, and credit risk decisioning takes on even greater significance than before. Consumers face uneven roads to recovery, with some ready to spend again and others still mired in pandemic-related financial stress. And businesses of all sizes report their operations are recovering but there’s still a way to go. A key difference we saw is that companies that adapted to serve customer needs digitally are faring much better. Our 2021 Global Decisioning eBook, Navigating a new era of credit risk decisioning, looks at how consumers are stabilizing their finances and how businesses are returning to growth. A recent survey among 9,000 consumers and 2,700 businesses across ten countries worldwide reveals the importance of lenders prioritizing digital transformation, and the role of advanced data and analytics in enhancing the customer experience. The pandemic fall-out is impacting everyone differently: 1 in 3 consumers remains concerned about their finances – paying bills and managing credit Whereas high-income households are no longer reducing their discretionary spending Navigating this varied credit landscape requires a deep understanding of customer needs on both ends of the spectrum. However, business confidence in the consumer credit risk management analytics models dropped over the past year from 71 percent to 61 percent. Smaller lenders with revenues ranging from $10M to $49M have seen the sharpest decline from 72 percent to 57 percent in the past six months. Adapting data and analytics to a rapidly changing customer base: Almost 50% of businesses surveyed said their dedicate more resources to enhance analytics One-third of businesses are planning to re-build their models from scratch Recalibrating credit models is one thing, but lenders also need to rethink their data sources to better understand current customer profiles. The data inputs generated by the pandemic have impacted credit risk models and machine learning applications in unexpected ways. For example, widespread payment holidays and government stimulus programs may be masking customers’ true financial circumstances. According to Recovery Insights, a separate study published by Experian North America: Delinquency prior to the pandemic is a strong indicator of future risk. Accounts exiting an accommodation period are 2x more likely to become delinquent than are accounts that never received an accommodation. Payment on debt during accommodation indicated a reduced risk for subsequent delinquency. Amidst the pandemic lockdown, consumers turned online to manage finances and connect with lenders – including older consumers.  And while the pandemic pushed consumers online out of necessity, now that they’re there – it’s become a preference – as overall digital gains are holding above pre-pandemic levels. Lenders have a new digital imperative to meet consumers’ evolving needs for continued digital engagement. Consumer expectations of digital experiences 55% of consumers have higher expectations of their digital experience since Covid-19 began 43% of consumers surveyed age 70+ reported digital banking throughout the pandemic 14% of consumers surveyed age 60-69 applied for a new loan or card online The importance of a digital-first approach has revealed itself and many companies have put a digital customer journey in place since Covid-19 began. The future, however, is more than providing online services. It’s about knowing your customers well enough to anticipate their credit needs and using tools to automate the process and reduce risk. Adapt or lose customers 9 in 10 businesses have a digital customer journey in place 1 in 4 consumers have taken their business elsewhere because a company didn’t adapt to their digital needs Online customer experience and credit risk management are more connected than ever before. And, businesses need technology that supports the entire customer journey, from onboarding to customer management to collections. Five digital investments businesses are prioritizing the new era of credit risk management: Implement new machine learning models for customer decisions Increase digital acquisitions and engagement Understand their customer base (affordability, value, behavior) Automate customer decisions Increase value of existing customers Access the report here to get more consumer trends and find out what the future of decisioning means for businesses looking to return to growth. Stay in the know with our latest insights:

What are the business challenges executives in fraud risk and fraud mitigation, and how and why the pandemic has shifted the fraud landscape?

How can businesses keep up with shifting consumer behaviors while ensuring fraud prevention is top of mind in the post-pandemic digital world?

In our first episode of the Women Making Waves in Tech podcast series, we hear from Shobana Balasundaram, Director of Product Management at Experian Global Decision Analytics. Shobana leads the product roadmap for PowerCurve Suite, Experian’s award-winning decisioning software platform. Shobana’s passion for introducing new solutions and product features is contagious: “During my time managing this collection of software solutions, I have had the chance to bring some advanced analytics and machine learning features to market. Indeed, some of the new product features that I have launched have driven nearly half of our revenue growth in the past few years, which confirms that decisioning software is a growing area. And I love my job!” Blending business strategy and tech advancements Shobana discusses what it takes to bring business strategy to life by applying the latest tech advancements. “It’s all about transforming an idea into a product and putting it in the hands of a client so they can deliver value to their customers,” explains Shobana. In her current role with the global product management team for decisioning software, Shobana is responsible for thinking about what kind of features to build into the product and forecasting the level of growth it will generate. That also involves addressing the market’s and competition’s reactions. But for her, the part she enjoys the most is “taking an idea, thinking about what is the possible problem you're solving and turning that into a product feature. Getting that idea-turned-into-a-solution in the hands of a client is a very satisfying experience, end-to-end.” Access all episodes of Insights in Action on Soundcloud, Spotify, Google Podcasts

The 2021 Global Identity and Fraud Report highlights consumer trends, with a deep connection between recognition, fraud prevention, and customer experience.

Did you miss these March business headlines? We’ve compiled the top global news stories that you need to stay in-the-know on the latest hot topics and insights from our experts. How to build consumer trust without sacrificing the experience This Forbes article explores the relationship between brand trust and customer experience using the lastest research from Experian. Read about how simple verification methods, personalization and ensuring the use of robust ethical data practices, can be key to driving consumer trust. Using AI for digital identification, fraud prevention, and increased ROI In this IOT for all article, Eric Haller, Vice President & General Manager of Identity, Fraud & DataLabs, covers how investing in AI will not only improve customer experience but also impact a company's bottom line. Digital and online trends in a post-pandemic world Nasdaq #TradeTalks Video Broadcast Series featuring Steve Wagner, Global Managing Director of Decision Analytics, covers what we should expect to see from consumers and businesses in a 2021 post-pandemic world when it comes to digital and online. How current data-driven digital identity impacts businesses and consumers 60 percent of consumers are using a universal mobile wallet to make digital payments according to Experian's latest research. Eric Haller, Vice President & General Manager of Identity, Fraud & DataLabs, talks to CNP about how digital identity solutions that use AI and ML will reduce fraud and improve customer experience when it comes to digital transactions. The sophisticated customer and the need for adaption This Q&A in the Digital Journal with Donna DePasquale, Vice President & General Manager of Global Decisioning, looks at how businesses should respond to consumers seeking a better online experience. Stay in the know with our latest insights:

Learn about enabling businesses to drive meaningful outcomes for consumers in moments that matter. Steps to enable positive change in society.

Did you miss these February business headlines? We’ve compiled the top global news stories that you need to stay in-the-know on the latest hot topics and insights from our experts. Experian launches new anti-fraud platform for digitally accelerated world Financial IT covers the latest on tools to help businesses safely meet the rapid increase in demand for digital services and online accounts. Eduardo Castro, Head of Identity & Fraud, speaks to gaining confidence in preventing fraud while meeting these new business challenges. Experian helps Atlas Credit double approval rates while reducing credit losses by up to 20 percent This Global FinTech Series article provides insights on efforts to make the power of artificial intelligence accessible for lenders of all sizes. Shri Santhanam, Executive Vice President and General Manager of Global Analytics and AI, shares background on constantly-changing economic conditions impacting credit models and how to rapidly develop and deploy models to keep up. 60 percent of consumers are using a universal mobile wallet New research shows a continuing trend toward digital transactions and mobile wallet payments. Steve Wagner, Global Managing Director of Decision Analytics, speaks to consumer and business insights on the increased demand and what businesses need to consider to ensure positive customer journeys that support these shifts. Why digital identity and the customer journey is crucial for today’s businesses Steve Pulley, Managing Director of Data Analytics, explores business opportunities stemming from the massive increase in consumers accessing services online. Taking the right steps not only helps ensure business survival but sustainable success. The key is fundamentals including the customer journey and digital identity. How modern data strategies underpin the digital identity and authentication practices critical to digital transformation In this Datanami article covering our progression toward a 'contactless world,' modern fraud prevention is explored. Dealing with a tremendous amount of data to offer security, while bearing in mind customer convenience, requires sophisticated technology. Holistic approaches both improve operations and helps keep pace with fraudsters to protect customers. Stay in the know with our latest insights:

If the past year revealed the rising demand for everything digital—it also highlighted key aspects of the online customer journey that organizations have neglected. Until now, most companies have prioritized their digital investments around the revenue-generating aspects of the customer experience. Online account onboarding, e-commerce, and credit lending are prime examples. However, when consumers require different outcomes such as payment support, the interactions are often still handled by call centers. We saw the consequences of this play out during the pandemic. As stay-at-home orders left call centers closed or understaffed, customers who needed help found themselves spending hours on the phone—or worse, were left without guidance. This digital disconnect may be common, but hopefully not for long. Forward-looking companies are creating end-to-end digital customer experiences that benefit customers and the business. From improved customer LTV (Life Time Value) to cost savings, the results reveal that prioritizing customers at every turn pays. The future of digital experiences revealed The last year yielded many insights into how, why, and when customers engage with a business digitally. Faced with few options, customers turned to online resources in droves. And unlike years past, when younger generations have driven digital adoption, the crisis forced customers of all ages to engage with businesses online. Around the world, companies rose to the challenge. According to Experian research, nine out of 10 businesses currently have a strategy for serving their digital customers, with 47% implementing their strategies since Covid-19 began. The rapid shift to digital uncovered opportunities to reach new markets. For example, online grocer Instacart™ launched support services specifically for seniors interested in grocery delivery. However, the sudden spike in consumer demand for engaging with businesses online also revealed significant gaps in the digital customer journey. Consider that only one in four consumers report that they can get help when they need it from a customer representative while online. We saw this play out in real-time after a global bank reached out because it needed a digital solution for payment support. The company had traditionally routed customers to a call center for help. But during the crisis, it was overwhelmed by demand. While working with this bank on a self-serve solution that enabled customers to address their payment concerns online, the experience revealed something important about the future of digital experiences: Regardless of where they are in their journey, customers expect—and deserve—the same experience. True digital yields a true value   Investing in a seamless digital customer journey is a long game, but it's one that can pay off exponentially. As we’ve seen, organizations have prioritized digital investment that brings in near-term revenue. These include mobile capabilities that increase customer conversions or personalized offerings that boost the average spend. And make no mistake, digital solutions that meet these needs are essential. But the customer who applies for a vacation loan may be the same one who later needs a payment holiday. Meeting these needs digitally, no matter what they are, engenders deep loyalty. Companies that support their customers during downtimes will gain customers for life and reap the benefits when those individuals are inevitably back on their feet again. The happy result is not only increased financial stability for customers but also improved advocacy scores and customer lifetime value. Additionally, an end-to-end digital customer experience can yield unexpected cost savings. For instance, an organization we recently worked with was spending an average of $35 per customer interaction. Their customers accessed customer service representatives via many independent channels, incurring costs each time they connected. We provided them with a multi-channel digital solution that reduced the cost to between $5 and $7 that allowed several interactions and provided consistent experience in the process. In the end, the company was able to deliver better service at a much lower cost point. From here to there The goal of building an end-to-end digital experience is a worthy one, and there are a few components of a forward-looking digital strategy that will help ensure success. First, companies need to create systems and cultures that allow them to respond to changing customer demands. No one predicted that a pandemic would rapidly accelerate our digital shift. But the companies improved their digital capabilities to meet the need came out ahead. Also, while customers experience the technology's front-end, orchestrating and supporting that journey across a range of consumer touchpoints driven by different events is equally as important. Implementing decisioning tools that leverage data across systems allows you to create advanced analytical models that predict customer behavior, potential problems, and more. Organizations can then make decisions in real-time to support customers and the business when they need help, be it a global pandemic or an environmental event. Lastly, taking advantage of emerging technologies can ensure your company keeps pace with the rapidly evolving expectations customers have for their digital experience. For example, AI-powered virtual assistants learn from every interaction and provide more personalized service than a standard chatbot that uses decision trees. These virtual assistants won't replace humans but leveraging them to augment customer experiences offers additional support to customers and creates continuity across the experience. The shift we've seen is about more than meeting the digital demand. At the core, it's about leveraging digital capabilities to see, understand and prioritize customers at all points of their journey. Then we can offer them proactive solutions that make their lives better and strengthen our businesses along the way. Related stories: New research available: Global Insights Report, February 2021  The role of the virtual assistant: Meet consumer demand for the digital experience Cloud-based decision management software is a must for re-imagining the customer journey