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BW Businessworld

AI-Driven Solution For Debt Recovery

Creditas Solutions offers a digital debt collection and loan recovery platform for banks and financial institutions

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Established six years ago, Creditas Solutions offers debt collection and delinquency management solutions to banks, financial institutions or non-banking financial companies (NBFCs), using machine learning (ML) to help lenders optimise their collections. It offers Artificial Intelligence (AI) driven solutions to help lenders improve recovery rates, while simultaneously improving the brand experience and customer loyalty. 

Most digitised banks tend to have digitisation at the front end, be it for loans or underwriting a debt. They usually show little interest in digitising collection. The idea behind Creditas Solutions’ product Ethera, is to have a digital solution and a much better outcome, wherein customers are in control of their own destiny.

Debt recovery by its very nature is an extremely fractious process wherein one party coerces the other to make a payment on a particular obligation with a written clause, at a specific time and date. Creditas Solutions aims to solve the problem of debt collections through a digitised process. 

The market perceives collections as a scenario wherein an authority dominates the situation and it is up to the individual, to find a productive and efficient way to repay dues. However, Creditas Solutions Co-founder and CEO Anshuman Panwar believes that the intelligent way to solve this problem is to make use of more data, with the help of existing technologies.  

Ethera 

Lenders currently rely on disparate tools and manual processes for collections. Ethera automates the entire workflow to provide a one-stop solution for debt collection, which includes data enrichment module sources.

Ethera cleanses and validates data from different skip tracing sources to simplify and improve customer contractability. It uses ML algorithms to engage customers via hyper-personalised content and nudges them towards payment. It is a nimble method of addressing debt collections without friction, across varied products like loans, cards and delinquencies like non-performing assets (NPAs) and write-offs. 

Debt collection is essentially a by-product of lending. India currently spends over $3 billion or thereabouts just on collections. Creditas Solutions has tapped into a very small fraction of that market, implying that there is a massive potential for growth.

If the market fails or is not a fit, the business will still be seen as a cheaper alternative to traditional methods of debt collection. With Ethera, the process is more seamless and personalized. 

Scale is about sales and Ethera shores up the bottomlines of bank, albeit in a circuitous way. Debt collection is generally seen as work involving people whereas Creditas’ solutions are digital. It is just a matter of time, though before the market turns to digitisation.

Ploughing Back 

Creditas ensured job safety of its employees by not letting go of people or downsizing during the pandemic and the lockdowns that followed. It was actually among the few companies that was actively hiring during this spell. 

The company has prioritized providing oxygen to people in need. Creditas also ploughs back into society through initiatives on credit literacy that involve educating people on money, money management and credit awareness. 

So far, 4.5 lakh people have benefitted from this initiative.