Thames Water Reduces Bad Debt 11% in a Year with FICO System
Highlights:
- Thames Water reduced bad debt from 3.6 percent to 3.2 percent of its turnover in just 12 months, a relative reduction of 11 percent over the last year
- Thames Water has been awarded the FICO Decisions Award for Debt Management
Thames Water, the
"The introduction of Debt Manager 9 has allowed us to design our treatment strategies from the bottom-up — rather than building strategies to the system limitations, we built them to the business and customer needs," said
Unlike services that can be terminated should customers default payment, it is not possible for Thames Water to block customers from water access, which makes debt collection challenging. Furthermore, Thames Water's supply area has a highly transient population with a large number of rental properties, which makes collecting and collating accurate data difficult.
"Our first step towards improving the debt management process was understanding our customers better, making sure we have accurate customer data and segmentation to allow us to treat them appropriately," said Betts. "The first data cleanse resulted in the update of over 500,000 customer names and the addition of 2.2 million customers' dates of birth. It also identified a large number of active accounts where the customers were no longer resident, with over £28 million of associated debt."
Thames Water also implemented FICO® Customer Communication Services, which sends reminder text messages and sophisticated interactive voice calls so customers can receive notifications of important account activity through the channel that suits them best. This personal approach to debt collection is a more effective way to engage with late-paying customers and increases the likelihood of customers paying their debts.
"Thames Water is using customer-level collections, with a lot of data management, from different areas," said
About the FICO Decisions Awards
The FICO Decisions Awards recognize organizations that are achieving remarkable success using FICO solutions. A panel of independent judges with deep industry expertise evaluates nominations based upon measureable improvement in key metrics; demonstrated use of best practices; project scale, depth and breadth; and innovative uses of technology. The 2016 judges are:
Dan Ariely , expert on human behavior, author of Predictably Irrational, andDuke University Professor of Behavioral Economics- Jim Bander, national manager, Decision Science,
Toyota Financial Services (2015 winner) Ken Elliott , global director of Analytics,Hewlett Packard Enterprise Bill Fearnley, Jr. , research director, Compliance, Fraud and Risk Analytics, IDC – Financial InsightsPetr Kapoun , retail risk director, Česká Spořitelna (2015 winner)- Dr.
Dalvinder Singh , editor,Financial Regulation International Nicole Sturgill , principal, Executive Advisor,CEB TowerGroup
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SOURCE FICO
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