Debt Collection Industry: Machine Learning Approach
نویسنده
چکیده مقاله:
Businesses are increasingly interested in how big data, artificial intelligence, machine learning, and predictive analytics can be used to increase revenue, lower costs, and improve their business processes. In this paper, we describe how we have developed a data-driven machine learning method to optimize the collection process for a debt collection agency. Precisely speaking, we create a framework for the data-driven scheduling of outbound calls made by debt collectors. These phone calls are used to persuade debtors to settle their debt, or to negotiate payment arrangements in case debtors are willing, but unable to repay. We determine daily which debtors should be called to maximize the amount of delinquent debt recovered in the long term, under the constraint that only a limited number of phone calls can be made each day. Our approach is to formulate a Markov decision process and, given its intractability, approximate the value function based on historical data through the use of state-of-the-art machine learning techniques. Precisely, we predict the likelihood with which a debtor in a particular state is going to settle its debt and use this as a proxy for the value function. Based on this value function approximation, we compute for each debtor the marginal value of making a call. This leads to a particularly straightforward optimization procedure, namely, we prioritize the debtors that have the highest marginal value per phone call. We believe that our optimized policy substantially outperforms the current scheduling policy that has been used in business practice for many years. Most importantly, our policy collects more debt in less time, whilst using substantially fewer resources leading to a large increase in the amount of debt collected per phone call.
منابع مشابه
Hidden Technical Debt in Machine Learning Systems
Machine learning offers a fantastically powerful toolkit for building useful complex prediction systems quickly. This paper argues it is dangerous to think of these quick wins as coming for free. Using the software engineering framework of technical debt, we find it is common to incur massive ongoing maintenance costs in real-world ML systems. We explore several ML-specific risk factors to acco...
متن کاملMachine Learning: The High-Interest Credit Card of Technical Debt
Machine learning offers a fantastically powerful toolkit for building complex systems quickly. This paper argues that it is dangerous to think of these quick wins as coming for free. Using the framework of technical debt, we note that it is remarkably easy to incur massive ongoing maintenance costs at the system level when applying machine learning. The goal of this paper is highlight several m...
متن کاملMachine teaching: a machine learning approach to technology enhanced learning
Many applications of Technology Enhanced Learning are based on strong assumptions: Knowledge needs to be standardized, structured and most of all externalized into learning material that preferably is annotated with meta-data for efficient re-use. A vast body of valuable knowledge does not meet these assumptions, including informal knowledge such as experience and intuition that is key to many ...
متن کاملPedagogical Approach in Machine Learning
Is it possible for humans to create the Artificial Intelligence smarter than human themselves? If yes, could it be realized by merely imitating human brains with the help of enormous computational capability or should there be a new paradigm of intelligence? Of course, we cannot answer the questions since we have not discovered such a paradigm that performs better than humans yet. I suggest tha...
متن کاملThe Analysis of Adaptive Data Collection Methods for Machine Learning
Over the last decade the machine learning community has watched the size and complexity of datasets grow at an exponential rate, with some describing the phenomenon as big data. There are two main bottlenecks for the performance of machine learning methods: computational resources and the amount of labelled data, often provided by a human expert. Advances in distributed computing and the advent...
متن کاملمنابع من
با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید
ذخیره در منابع من قبلا به منابع من ذحیره شده{@ msg_add @}
عنوان ژورنال
دوره 14 شماره 4
صفحات 453- 473
تاریخ انتشار 2019-10
با دنبال کردن یک ژورنال هنگامی که شماره جدید این ژورنال منتشر می شود به شما از طریق ایمیل اطلاع داده می شود.
میزبانی شده توسط پلتفرم ابری doprax.com
copyright © 2015-2023