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Automating Credit and Collections Decisions at AT&T Capital Corporation

Author

Listed:
  • George Curnow

    (AT&T Capital Corporation, 44 Whippany Road, Morristown, New Jersey 07960)

  • Gary Kochman

    (AT&T Labs, 101 Crawfords Corner Road, Holmdel, New Jersey 07733)

  • Steven Meester

    (AT&T Labs, 101 Crawfords Corner Road, Holmdel, New Jersey 07733)

  • Debashish Sarkar

    (AT&T Labs, 101 Crawfords Corner Road, Holmdel, New Jersey 07733)

  • Keith Wilton

    (AT&T Capital Leasing Services, 550 Cochituate Road, Framingham, Massachusetts 01701)

Abstract

AT&T Capital Corporation, the largest publicly held leasing and financing company in the US, owns and manages over $12 billion in assets. In 1992, we began work to enhance the viability and profitability of its small-ticket business. We designed three sets of decision automation systems and the associated decision strategies for front-end credit decisions, life-cycle credit-line management, and delinquent account collections. The majority (73 percent) of the credit-granting decisions in AT&T Capital's small-ticket business are now made automatically, including $685 million in new transactions annually. Productivity gains have enhanced competitiveness by reducing response times and increased profitability by reducing credit and collections operating costs by over $3.1 million annually. Finally, improvements in decision quality have led to business volume gains of $86 million annually, while reducing bad debt losses by $1.1 million annually.

Suggested Citation

  • George Curnow & Gary Kochman & Steven Meester & Debashish Sarkar & Keith Wilton, 1997. "Automating Credit and Collections Decisions at AT&T Capital Corporation," Interfaces, INFORMS, vol. 27(1), pages 29-52, February.
    • Handle: RePEc:inm:orinte:v:27:y:1997:i:1:p:29-52
    DOI: 10.1287/inte.27.1.29
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    Citations

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    Cited by:

    1. Peter C. Bell & Chris K. Anderson & Stephen P. Kaiser, 2003. "Strategic Operations Research and the Edelman Prize Finalist Applications 1989--1998," Operations Research, INFORMS, vol. 51(1), pages 17-31, February.
    2. Matuszyk, Anna & So, Mee Chi & Mues, Christophe & Moore, Angela, 2016. "Modelling repayment patterns in the collections process for unsecured consumer debt: A case studyAuthor-Name: Thomas, Lyn C," European Journal of Operational Research, Elsevier, vol. 249(2), pages 476-486.
    3. Zhixin Liu & Ping He & Bo Chen, 2019. "A Markov decision model for consumer term-loan collections," Review of Quantitative Finance and Accounting, Springer, vol. 52(4), pages 1043-1064, May.
    4. Peter C. Bell & Chris K. Anderson, 2002. "In Search of Strategic Operations Research/Management Science," Interfaces, INFORMS, vol. 32(2), pages 28-40, April.
    5. L. Smith & Baiqiang Jin, 2007. "Modeling exposure to losses on automobile leases," Review of Quantitative Finance and Accounting, Springer, vol. 29(3), pages 241-266, October.

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