Delinquency and associated credit losses are an expected fact of lending. And certain factors are beyond the control of risk managers. Some percentage of customers will become delinquent and stop making payments because they lost their job, got divorced, ran into medical issues or the other common reasons that create individual financial stress. Sometimes lenders have no levers to pull and borrowers no means to pay. But lenders can affect good and bad balances, and they can offset the losses with gains among good customers. This is pure balance control – but today it is stepping it up to a higher level of accuracy and timeliness by leveraging preemptive risk tactics. This takes looking at the performance of new and current accounts on several different dimensions, predicting the credit risk of an account (absent of known fraud), predict known fraud itself, as well as assessing the revenue growth for the account and finally to identify those customers that may have a high likelihood of cancelling their account. By doing so, lenders achieve a multi-dimensional view of each customer – gaining the ability to strategically choose which customers to retain and cultivate and which customers to limit, wind-down, or cancel.

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