Prescreen and Credit Risk Labs: Increasing Number of Accounts Per Consumer

Financial institutions (FIs) know the value of gaining customers with low-risk accounts and services. Most often these are demand deposit accounts (also known as checking accounts). Through these accounts FIs build relationships with consumers and build the trust necessary when the consumers want to apply for additional products, such as a mortgage or auto loan. There is software available that aids in the optimization of the account opening process resulting in higher customer satisfaction and profitability for the FI.

Instant prescreen is a process that takes place at the time of consumer interaction; this can be in the branch, online, over the phone, or on a mobile device. Instant prescreen determines the best offers for existing customers based on their history and allows the institutions to maximize the wallet share of customers that already hold one or more accounts and do so at an extremely low cost. Instant prescreen also tracks the offers that have been made to the customer previously and whether or not they were accepted. With alternative credit data available, FIs are able to get a more holistic view of the consumer and make an offer based on that information. Because the offers determined by instant prescreen are catered to customers on an individual basis they are more likely to be accepted. For financial institutions this is beneficial because the more accounts a consumer has the less likely the risk of attrition.

Credit risk management software helps FIs model platform changes in realtime without the delays incurred in traditional processes. They are able to use past transactions to simulate what happens when decisioning platforms are altered. This software is able to return results in a matter of hours, versus the traditional method which could take months. It is a way for FIs to substantially decrease the risk associated with using new credit attributes, as the new attributes are tested using real performance data before they are implemented. In relation to account opening, credit risk management software is available to help FIs test various decisioning platforms to find out which attributes, scorecards, etc. need to be modified to help the institution better meet its goals and respond to external changes quickly.

Financial institutions have two distinct ways to increase the number of consumer accounts: gain customers that had no previous account and expand the number of accounts per existing customer. With instant prescreen software, FIs are able to take the data about an existing customer and make an offer that they are most likely to accept. With credit risk management software, FIs are able to simulate models that may be more predictive for evaluating credit risk. Credit risk management software and instant prescreen have both cut down on processing time dramatically and provide timely, accurate results.

Kelty Wallace is an online marketing intern at Zoot Enterprises in Bozeman, Montana.

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How to Properly Avoid Credit Card Fraud

Arm Yourself

Credit card fraud can happen to anyone and is becoming more common. You need to arm yourself with the knowledge of how to prevent it and what to do if it happens to you. Hold onto your credit card receipts and dispose of them properly. While most places are now hiding your credit card numbers and only showing the last four digits this is not always the case. Some receipts will still show your entire credit card number and if you have placed your signature on it as well then a thief has enough info to go on with just that alone. They can put in for a change of address to your credit card company and spend it all before you ever know what happens. You'll wonder why your bill hasn't come in yet, and if you put it off, the collectors will come calling. Don't wait, if your bill is late then you need to call your credit card company and find out why, and also to check if there are any charges that you have not placed on the card.

Properly Dispose of Personal Info

So it turns out you have great credit and receive regular offers from credit card companies with great interest rates, but you have enough cards so you toss your junk mail in the trash, sometimes without even opening it. Bad idea. Many thieves will happily dumpster dive to get some good info. They can take those pre approved offers, and often times don't even need to speak to an actual person. They will open the card in your name through an automated system to make things fast and efficient and start spending your money as quickly as possible. Shred those offers, dunk them in water, burn them, whatever it takes to get your information scattered, hidden, and difficult to contend with. Make it difficult for those thieves so they won't want to mess with it. You can 'opt out' of these offers by sending a request or calling the company and asking them to remove you from the list.

What about those old deposit slips at the back of your checkbook that you never used? You know the ones with your name, complete physical address, your account and routing number. Someone could very easily transfer money to a temporary account, or just write a bad check to deposit and sign for the money in the less cash received section. Black out all the info and shred them before you throw them away. The same goes for voided checks.

Don't Give Out Your Info Unless Necessary

Your social security number is, unfortunately, your identity when it comes to many things, including your credit. Make sure it is absolutely necessary before giving out this information. If a company calls you, claiming they need to update your information, get their number and call them back before you give any of it out. Many identity thieves will call you, pretending to be some credit company associated or working with your credit card company and ask to 'update your info' and you will give them all the info they need to open up accounts and start spending.

Monitor your spending. If anything shows up that you did not buy, call immediately. If your bill is taking longer than expected to get to you, call. Automated systems make things easier not only for you, but for identity thieves as well. Go paperless if possible so you don't have any physical papers a thief can get too easily. You can buy protection through many companies that will alert you if there any changes in your credit. In the end just be careful with any info that can lead to your bank or credit card account. Make sure you dispose of the information properly and you may be able to avoid the stress and hassle of identity theft.

I hope this will help you Prevent Credit Card Fraud but come visit us if you ever need to Report Credit Card Fraud

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Why and How a Merchant Can Accept Credit and Debit Cards

Many businesses, especially when they are new or relatively small in size, will pay little or no attention to increasing the number of options by which customers can pay. This is particularly true of credit and debit cards, as many merchants believe that the costs regarding initial set up may not be quickly recovered.

There are four primary reasons to accept credit and debit cards in a business:

1. Increase sales or revenue

2. Bring in new customers

3. Lessen trips to the bank (or having to deal with bounced checks)

4. Lower administrative costs

Let's look at each of these in turn:

Increase sales or revenue

Many studies over recent years have shown that the average size of credit card orders or payments is anywhere from 20% to 50% larger than cash and check orders or payments. In other words, just by adding this choice to existing customers they increase the amount of money that people are prepared to pay for goods and services. Many merchants, small and large attest to this and reap the benefits accordingly.

Bring in New Customers

Many customers want to pay by credit or debit card but need to be given the opportunity to do so. Studies show that credit and debit card payments (in combination) have already overtaken cash and cheque payments. Customers often get benefits for paying with credit or debit cards such as frequent flier miles or other "affinity" type points. Paying with a credit card also gives customers more flexibility to manage their personal cash flow.

Lessen trips to the bank

By making credit cards an additional method of payment, you decrease the time it takes to process orders by waiting for cheques or other slower payment methods. In addition, you also reduce or even eliminate bounced cheques, and the costs of having to deal with this problem administratively.

Lower administration fees/costs

Because credit and debit cards can be accepted on the Internet or at a terminal (by swiping the card) the transaction is an electronic one and can readily create an on-line record that is easy to record and/or transfer to an accounting or other administrative system without further keying. Administration time (and particularly reconciliation effort) is therefore reduced or simplified or both.

By taking credit and debit card payments, merchants will also typically improve their relationships with customers. In addition, the more difficult it is for customers to make purchases, the more likely your business is to lose customers. Meanwhile, your business will be able to increase retention by offering customers with recurring charges or fees the opportunity to pay automatically.

This article was written by Dr Jon Warner of Payswyft (at http://www.payswyft.com/ ). Jon has extensive senior executive experience and has led organizations in a variety of industries through significant transitions to achieve bottom-line results. He is an expert in developing and implementing strategies in leadership development, operations, marketing, sales, and corporate turnarounds as well as building entire learning systems. Jon is currently CEO of PaySwyft in the UK (an innovative on-line billing and payment business) and Chairman of WCOD (a management consulting and publishing business).

He can be reached at jon.warner@payswyft.com.

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