Neobank Reduces Cost, Improves Performance: Retain’s Digital-First Approach Beats Call-and-Collect

Online-only banks (also known as neobanks) have become popular with consumers by providing all the services of a traditional bank without the physical locations. And for one neobank, their mission of providing an online option for second chance banking for those who might not qualify to open an account elsewhere is helpful for underserviced portions of the population, 

But as they do for any bank, delinquencies still happen—and the neobank’s communication strategy with past-due customers didn’t match up with their digital-only approach for all their other types of engagement and transactions, instead relying on a third-party calling-based servicer which supplemented manual email communications.

This presented several challenges for the neobank:

• Financial overhead for 10 full-time employees (FTEs) dedicated to the neobank’s account through the third-party servicer was increasingly expensive 
• Manual email process lacked visibility into deliverability and overall effectiveness
• Bandwidth for only prioritizing larger debt amounts, leaving many accounts untouched
• One-size-fits-all approach stifled consumer engagement and, in turn, repayments
• Complete absence of data-driven decision-making, relying instead on FTEs’ discretion

Overall, the third-party servicer was cost-inefficient and lacked the sophistication needed to harness the full potential of the digital advancements the neobank was founded on. But Retain by TrueML Products offered a solution to these challenges and more.

Through a champion-challenger pilot between their existing third-party calling-based servicer and the innovative Retain by TrueML Products platform, the neobank could evaluate the effectiveness and efficiency of both strategies in the realm of engaging past-due accounts.

Unlike the static and human-dependent strategies employed by the third-party servicer, Retain’s digitally driven adaptability led to a marked improvement in the neobank’s customer engagement and resulting collection outcomes…

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