As with most areas of business, credit management evolves and grows as new technologies and innovation become available. Thanks to advances in technology, new trends are emerging on the credit management scene. This will allow businesses to lower costs, drive efficiencies, save time and may even have the potential to reshape the role of the credit manager.
Looking to the year ahead, we foresee three trends having a major impact on the world of credit management:
Across the finance sector, solutions are being sought in order to automate more credit management processes. As a result, artificial intelligence (AI) and machine learning (ML) are increasingly being used in credit management software solutions. Organisations are actively looking at the order-to-cash process, in particular, to see how many manual actions are currently taking place and to identify which can be replaced by software solutions. For example, it is possible to fully automate outward actions, such as auto-populating and sending invoices and communication. This will allow them to minimise the amount of manual labour spent on such tasks.
Additionally, the increasing use of AI and ML means that if credit managers can find logic to handle a certain type of debtor, for example, they can make processes as automated as possible. The ability to automate these tasks will dramatically reduce the amount of time spent on active dunning on outstanding invoices. This will allow credit managers to focus on the more complex debtor situations and tasks that can result in a higher level of revenue as they are more value adding to the managers and the business.
In the B2C world, people are getting used to self-service platforms and services which allow them to make their own payment arrangements, register complaints and obtain copies of invoices, for example. Providing a self-service platform drastically reduces the interaction with credit managers. This gives them more time to focus on the more complex tasks and bigger accounts, rather than the smaller day-to-day queries. We will begin to see this infiltrate the B2B realm as businesses look to gain the same online capabilities. This will allow credit management to be something that takes place 24-7, enabling customers to access information about their account at any time, rather than just within office hours.
Big data is a hot topic across most industries and credit management is no different. We are only just realising the potential of big data. And as such, we are seeing a growing trend of organisations trying to do more with it. Big data is reshaping financial institutions and will become integral to the credit management process. Thus helping credit managers to formulate a well-rounded view of their customers and therefore reduce risk. As our CTO, Marieke Saeij recently pointed out, big data “can yield profound insights, improve performance and enhance customer experience”. As more organisations get to grips with this, we’ll see big data play a bigger role in credit management. You can find out more about the use of big data in the finance sector here.
You can also read this blog on the Onguard website!