Credit decisioning, defined as the process of determining whether or not to extend payment terms to a new customer, is often an arduous and overly complicated process for many businesses, especially when they rely heavily on manual processes to reach decisions.
As a leader in credit risk management, CreditPoint has seen and solved our fair share of inefficient credit decisioning programs. In this blog, let’s discuss the main challenges associated with manual processes and how automation can step in to reduce bad debt.
The Problem With Manual Credit Decisioning
The goal of credit decisioning is to reduce financial risk by determining if and when clients will pay back debt. This includes an endless list of manual processes, spreadsheets, and other dynamic factors that make a credit decision extremely time-consuming and costly. Best-in-class organizations will also rely on more sophisticated predictive scoring models to help determine whether to make a credit approval.
Throughout the process, there are many opportunities for error with very little team visibility to correct any potential mistakes. In addition to the sheer amount of man hours that are currently being spent on manual credit decisioning at organizations across the globe, these organizations lose that time and money in the long term by exposing themselves to bad debt.
In today’s technology-enabled world, most manual processes have automated solutions. CreditPoint’s automated credit decisioning includes all the tools and features you need to reduce both short-term cost and future bad debt, positioning your organization for success.
Why Automated Credit Decisioning Works
Automated credit decisioning takes the human error out of credit approvals by automating the entire process from scoring models to review, approval, and assigning a credit limit. Best-in-class solutions such as CreditPoint’s enable you to create configurable scoring models to standardize the review process and minimize risk. These processes work together to reduce bad debt and increase time to revenue, resulting in large-scale operational efficiency improvements that can be felt across the organization.
Since automated workflows free up time for your credit analyst, that time and money can now better be spent on in-depth analysis on riskier clients or other business priorities. Our solution saves clients hundreds of thousands of dollars a year, which translates into net profit for the organization. It also allows credit analysts to focus their time on more complex credit cases which require a rigorous, subjective, and a manual review process.
Organizations can no longer afford to ignore the power of automation, particularly in an area as consequential and time-consuming as credit decisioning. Automation has dramatically transformed the credit risk management process by maximizing efficiency and accuracy.
Our mission is to provide the most comprehensive commercial credit risk and collections management solution available on the market. Schedule a consultation with CreditPoint Software to learn more.