Predictive Analytics in Portfolio Management
Predictive analytics helps to identify the customers who would be at risk in the future and what actions banks should take. By analyzing the historical data, banks can attain a better understanding of their portfolio risk and thus improve the productiveness of the collections process.
A data-driven approach can help in clustering different types of customers based on their financial behavioral patterns. This will help the bank to take strategies based on the cohorts. This use case will help in the reduction of loss by improving risk mitigation techniques.