Published on February 15th, 2016

Berlin-based big data startup digitizes debt collection process

With the use of big data and machine learning, fintech startup PAIR creates a digital debt collection process which increases repayment rates and turns debtors back into customers.

The development of PAIR was driven by fintech pioneer and former Kreditech CEO Sebastian Diemer. In the development of ROSE (Realtime Online Settlement Engine), the fintech startup was supported by SimplyRational, a company of the Max-Planck-Institut für Bildungsforschung in Berlin.

The debt collection process, so far, has been highly contradictory to modern online shopping behavior: customers tend to order goods online and expect a fully digital payment process. The debt collection process – once a payment is forgotten – still works completely analog and without customer centricity.

To receive higher repayment rates and turn debtors back into customers, PAIR focuses on individual address, smart repayment plans, and self-learning algorithm which assesses each situation of a debtor individually.

“The PAIR process works with self-learning algorithms and creates the right communication content for each debtor in real time. This content is then delivered in the best possible context to create an online dialog with the customer. The automated analysis of reasons why a debtor was not able to pay allows us to create fitting payment solutions”, says Sebastian Diemer.

How PAIR works:

  • Automated mediation with ROSE:

The Real time Online Settlement Engine ‘ROSE’ enables a new type of constantly evolving claims management. The digital dialog process is started automatically based on the analysis of process data and customer histories. By using big data and self-learning algorithms, the success rate of debt collection increases with every case – and secures long term customer relations.

  • Multichannel approach:

Customers don’t want communication via one channel anymore. As in online shopping customers expect various payment options for online payments. With the multichannel approach PAIR makes communication and payment process easier by eliminating media disruptions.

  • Privacy protection

The protection of data privacy is a top priority for PAIR: working according to strict industry standards, all typical measures such as emergency concepts, physical access controls, and data encryption are included in the PAIR process from day one.