Lloyds’ Black Horse wins innovation award for ‘Arrange-to-Pay’ app

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FICO, a predictive analytics and decision management software company, announced that Black Horse, part of the Lloyds Banking Group, has received a 2013 Financial World Innovation Award for Most Innovative Application of Technology, based on an application developed using FICO technology.

The combination of interactive SMS texts and automated payment capture allows Black Horse customers to pay overdue debts easily. This approach has increased the amount paid per plan by 25 percent, and the number of successful payment arrangements with overdue customers by 9 percent, while simplifying the customer experience.

“Our innovative approach means we can collect payments in arrears anytime,” said David Morpeth, Operations Director of Black Horse, which helps more than 200,000 UK customers every year to finance new and used cars, caravans, motorhomes or motorbikes. “With this application, we’ve made it much easier for our customers to resolve outstanding debt.”

The first step in making payment plans is a call from a Black Horse advisor. Once the payment plan is arranged, Black Horse uses the Arrange-to-Pay application, based on FICO® Customer Communication Services, to automatically manage collections contacts in a phased approach.

Two days before payment is due, an SMS reminder is automatically sent to the customer.  The text directs the customer to the Black Horse Make a Payment / Manage My Account website, where payments can be made 24/7, including the option of using a card — a feature that very few finance companies offer to their overdue customers. Using this approach, Black Horse has reduced the number of calls to its Contact Centre, as well as reducing the percentage of arrangements that fail because the customer forgets to pay. 

Customers who have not paid by the due date receive a SMS via FICO. The interactive SMS message includes the option for the customer to request an immediate call back. FICO’s outbound voice application then helps the customer make a payment using an Autopay facility.

If payment has not been received two days after the deadline, a reminder text is sent to the customer.  Customers are scored for risk, and based on their risk level may receive a grace period of 2 to 10 days. 

Knowing customers are increasingly using their smartphones and tablets to access the internet, Black Horse redesigned its Make a Payment/Manage My Account website to optimize it for mobile payments. Visits to the site from a mobile device increased by 19 percent from January 2012 to June 2013, and have continued to increase each month since.

Black Horse is now in the process of implementing a continuous payment authority for arrangement to pay, which will enable its advisors to set customers up with a new arrangement to pay using payments automatically taken from a nominated card.

“Black Horse is using technology to make life easier for clients who are having credit problems,” said Hayley Kershaw, managing director for FICO in Europe, the Middle East and Africa. “Their work demonstrates the new focus on the customer experience that is taking place in debt collection. FICO congratulates Black Horse and Lloyds Banking Group on this important award.”

 

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