Automatic loan repayment reminders

Challenge

A large bank offering various types of loans noticed that despite clear repayment schedules, some customers regularly forgot to make timely payments. This resulted in a growing number of late payments, which generated additional costs for the bank. In addition, late payments resulted in penalty interest charges. The lack of automatic repayment reminders was a burden on the customer service department, which had to contact customers manually.

Action

1. Segmentation of customers by repayment status
   Customers were divided into segments depending on the upcoming payment date. In addition, the customer's payment history (whether they paid regularly or had previous delays) was taken into account, which allowed for the frequency and tone of communication to be adjusted.
2. Omnichannel communication
   Customers received short SMS reminders a few days before the payment deadline and on the deadline date. In the event of a delay, further reminders were sent within a short period of time. For customers using the banking app, personalized push notifications were introduced, which appeared on the phone screen, reminding them of the upcoming installment. A few days before the due date, customers received emails containing payment details (amount, date, account number) and a link to quick online payment. In the event of a delay, the email also contained information about the consequences and ways to settle the arrears.
3. Content personalization
   The content of the reminders was tailored to the customer segment and repayment status. All messages contained a clear CTA, i.e., information on what the customer should do to avoid problems.
4. Process automation
   The entire system was fully automated, integrating with the bank's internal systems (loan management system and customer data). As a result, reminders were always sent on time and to the right people, without the need for manual intervention.

Results

• A 22% reduction in loan repayment delays within six months of implementation.
• A 10% reduction in debt collection and arrears management costs thanks to proactive prevention of delays.
• Increased customer satisfaction: Surveys showed that customers appreciated the bank's proactive communication and found it helpful.
• A 12% reduction in working time for the customer service department, which was able to focus on more complex issues.