Challenger credit reference agency Credit Kudos has been chosen by debt management platform Ophelos as its Open Banking partner to improve the collections process for customers by delivering more personalised repayment plans.
Ophelos will use Credit Kudos’ Open Banking insights to better understand the current financial position of individuals who have been referred for debt collection by lenders, and then identify repayment solutions that “best fit” the individual’s circumstances.
Two months into deployment, the debt management platform has reported a 68% improvement in customer satisfaction, a 26% increase in recovery rates, while the cost to collect has reduced 25%.
Amon Ghaiumy, CEO and co-founder of Ophelos, said: “Debt collection is often upsetting and stressful, but we are reimagining this process by putting customers at the heart of what we do, and Open Banking is an incredible opportunity to allow us to achieve this goal.
“Using Credit Kudos’ advanced Open Banking insights, we can give customers a simpler, fairer and faster experience, create a repayment plan that is manageable for their personal financial situation and set them on the path to better financial health.”
“The pandemic has pushed many people into arrears, and there is an urgent need to support these individuals to regain control over their finances and avoid long-term debt spirals,” added Credit Kudos founder and CEO Freddy Kelly.
“Time and time again, we’ve seen the immense power of technology when it comes to driving better outcomes for consumers, and the collections sector is next in line to reap the benefits of innovation.”
According to Credit Kudos, 18% of people considered vulnerable by the Financial Conduct Authority, the UK regulator, have missed payments or gone into arrears over the past 12 months, with 14% taking on further debt as a result.