Issuers Focus on Data-Driven Personalization to Boost Cardholder Confidence
NEW YORK – Septemberโ 23, 2024 – Credit โcard issuers โคare increasingly prioritizing continuous monitoring of cardholder behavior and โขleveraging real-time data โto deliver personalized experiences, aiming to close the “credit confidence gap” and foster long-term relationships, accordingโ to industry leadersโข speaking with PYMNTS.The shift focusesโ on moving beyond initial card โacquisition to ongoing assessment and product “graduation” tailored to individual financial journeys.
David Durov, SVP of โconversion at i2c,โค emphasized the importance of โขsustained measurement. โค”What we don’t always do a greatโฃ job of is โขcontinuing โto measure, โand continuingโ to watch for the signals over the life of a relationship.That really is the nonnegotiable part here,” he stated.He advocates for “data-driven triggers” and platform-integrated behavioral tools to enable โimmediate, targeted interaction.
The need for proactive portfolio reviews was highlighted by โขClearview’s representatives, whoโข notedโ that a card suitable for a customer ten years prior may no โขlonger โฃmeet their needs. They’ve implemented portfolio reviews andโค line increases to demonstrate responsiveness to evolving financial situations.โฃ
Varo Bank employs a dual underwriting โฃstrategy,โฃ relying on cash flow analysis for 95% of its decisions, supplemented by โtraditional bureau dataโ for the โคremaining 5%. this approach facilitates entryโข through credit-buildingโฃ products โand unsecured loans, fosteringโ cross-portfolio growth.
Durov envisions a future of “a segment of โone,” where issuers utilize dataโ and behavioralโ signals to understand each customer’s โlifecycle stage and present relevant offers. Varo already leverages cash โflow analysis for timely installment offers,while โClearview is exploring predictive outreach.
Issuers are also focused onโข agility inโค product โขadvancement. Durov noted that while notโ all institutions can launch new products weekly, platformsโ like i2c’s enable rapid customization and โคtesting of new features. He described i2c’s platform โas “a very customer-centric platform, not a product-centric platform.”
Looking beyond traditional unsecured โcredit, durov pointed to opportunities inโ buy now, pay later (BNPL) and the potential of artificial intelligence โคto deliver โ”customized experiencesโข and treatments” โthrough โฃhyper-segmentation atโ the household and customer level.