Credit, Collections & Insolvency News
Credit Connect’s hosted its fourth Online Lending Technology Think Tank last week which saw lending strategies and the future of the sector discussed by fourteen leading professionals from a variety of lending sectors.
The event was attended by over a hundred lending professionals from banks, credit card providers building societies, loan providers, credit unions and fintechs were amongst the viewers across the four sessions.
The themes of credit risk, affordability digital lending and regulation were discussed by panellists and Chair Chris Warburton from ROStrategy The insights from the event were recorded and now can be viewed by clicking on this link.
Event Chair, Chris Warburton from ROStrategy said “It was great to be able to chair the Lending Technology Think Tank from Credit Connect. It was such a great group of speakers, at such a pivotal moment of change and with so much going on it was fascinating to see what is happening today in the lending market. In particular, it was fascinating to listen to how lenders are thinking about the future, mitigating credit risk and ensuring customers are protected. There was plenty of forward thinking. Flexibility is clearly going to be important together with innovative ways of looking at data combined with some new technology approaches and it was a privilege to be involved in getting such a brain trust together.”
Colin White Founding Director at Credit Connect said “It was great to see such a great mix of lending professionals take part in the industry panel discussions supported by the viewer interactions responding to the survey polls and asking questions during the lending-focused event.”
“We have had some great feedback from the attendees and am looking to continue some of these conversations at the next virtual Lending Technology Think Tank in April next year and at the face-to-face Credit & Collections Think Tank in Manchester on 17th November.”
Jason Wassell, Chief Executive of the CCTA said “It is always useful to discuss emerging issues, to give our views but also to hear from others. It was good to focus on Consumer Duty, which will impact on every financial service firm. It will dominate leadership Great to consider the regulatory issues and also how technology might help us deliver such a big change.”
Whilst panel speaker Frank Sherlock, VP International from CallMiner said ‘’ The regulations for Financial Services firms has become even more demanding with the impending Consumer Duty requirements. The ability to assess that the right outcome was delivered on every interaction, across all channels, requires technology to assist Financial Services firms in delivering on these obligations. The Cost of Living and economic challenges are giving rise to an increasing number of vulnerable customers, so the regulatory landscape is as challenging as it has ever been’’
Andrea Cox, Director of Affordability at Experian said “The next 12 to 18 months will be a critical time for consumers and business. We’re heading into the uncharted territory of double digit inflation and an unprecedent squeeze on real-disposable incomes which many, more financially secure consumers have not experienced before. Having the opportunity to discuss how data can be used to help lenders improve their credit decisions whilst enabling consumers to access affordable finance is topical and key to the success of many organisations. It was great to be talk constructively about the challenges and provide positive advice to the audience on how best adapt to the changing environment.”
If you are interested in speaking or becoming a sponsor for the next event then call 01622 535075 or email events@credit-connect.co.uk for more information. More online events will be confirmed soon.
The event was sponsored by CallMiner and Experian.
Responses to selected questions:
Do the panel think that the economic shock will get people to reassess their outgoings?
James Wilkinson from Fair for You: “Our customer base won’t have too many changes they can make. There will be some who will sacrifice their discretionary spend to prioritise food and heating, but we don’t tend to serve many of these. We are anticipating a number of our good existing customers will fall off plan over the winter as they prioritise other bills, our challenge is to keep them engaged with us over this coming period. I also envisage we will see a drop in applications for our core products, as people will make do with the white goods they have, or look for cheaper second hand deals. The demand we will see will be for the Food Club micro loan to help people put food on the table during tough months.”
Andrea Cox from Experian: “Yes, most definitely we’re already starting to see changes in people’s behaviour in our bureau. Bear in mind, that we start from a very different position to last economic downturn. The pandemic left many households in a better financial position having paid-off their credit debt and increased their volume of savings. The impact of the energy price rise and the proportion of a household’s total income the price rise consumes is the biggest difference now facing all UK consumers, rich or poor. As ever it is the poorest households that are most adversely affected . We’re already starting to see increases credit card balances and use of overdrafts, shifts in re-mortgaging as homeowners seek new fixed term deals, along with a fall in applications for secured loans such as car finance. It all points to a re-balancing of behaviour and tightening of people’s belts”
Some firms seem to be dragging their feet on the October deadline set by the FCA for Consumer Duty and instead focusing on next July. Do the panel think that these firms are at risk?
Jason Wassell from CCTA: “Of course, it makes sense for firms to move forward as quickly as possible. Not least because this is a complex process that will take as long as we have been given by the FCA.”
“I have heard some discussion about a focus on next July as that is the date set down in stone, while the October deadline is laid out in the policy statement. As if there is a significant difference. I think also some will wonder what the chances are of the FCA’s gaze falling upon them.”
“My advice is that any lender that hasn’t taken steps ahead of the October deadline is taking a considerable risk. If you are asked and are unable to explain your approach, and your implementation plan then that is going to damage any trust the FCA has. It will invite another level of scrutiny that may place pressure on a firm.”
How can technology help identify those vulnerable customers?
Frank Brown from CallMiner: “Technology such as conversation analytics, provides firms with the ability to look at every conversation and identify if process was followed, if vulnerability was detected and recognised and appropriate actions taken. It enables organisations to filter the interactions that really matter, be they excellent examples of best practice that can be used for training purposes or interactions where risk is present that need to be actioned. It allows firms to have a holistic approach to risk and employee development and deliver the appropriate outcomes for the business and the consumer. Learn more on how conversation analytics can help provide valuable insights into your customers.”
Jason Wassell from CCTA: “We need to rely on technology. Some flags can be noticed by the systems that we use. Other technology can help us review the work we do and check that we are doing our best to support those with vulnerabilities. However, no one will be surprised that we can’t remove human involvement. Technology helps us but it has its limits.”
What information do you think lenders need to enable better risk-based decisions?
How do you currently monitor customer conversations?
Are you looking at investing in conversation analytics technology following the FCA consumer duty regulation?
* ALL EVENT DATA AND POLL RESULTS ARE COPYRIGHTED TO CREDIT CONNECT MEDIA AND SHOULD NOT BE USED OR SHARED WITHOUT OUR PERMISSION
Recordings will also be added soon to Credit Connect’s Youtube channel. An archive of all past digital events can be viewed on Credit Connect’s Youtube channel which can be found here.