Risk management teams evaluating credit opportunities are challenged to identify new business that could benefit their company’s portfolio while also avoiding risky propositions and uncovering cross-sell candidates within the existing client population.
The use of enterprise risk management software that includes automated credit decisioning capabilities can mean all the difference for these professionals, particularly at a time when many consumers say they are concerned about the state of their personal finances.
A recent report from the insurer Allstate sought to survey Americans on sentiment and confidence, seeing how consumers feel about their current financial status and determining what measures these individuals are taking to shore up their future.
According to the results, 50 percent of Americans describe their current financial situation as “poor” or “fair.” While a surprising majority say they felt confident about their future, few sought the types of financial products that Allstate analysts say could guard them against future economic hardship. These products include life insurance and retirement saving measures.
The results may also reflect Americans’ eagerness to seek credit and other financial products from lenders. Recent reports show improving sentiment towards credit cards – a release from J.D. Power and Associates said customers are increasingly satisfied with their cards – but consumer reluctance makes it difficult for some banks to expand customer portfolios.
This makes automated decisioning a crucial capability for lenders. With risk management software that includes advanced decisioning capabilities, banks will be able to evaluate new and existing customers to find the most fruitful opportunities. At a time when consumers are slowly returning to the market and risks are still present, bank executives should continue to encourage this type of careful consideration.
