The Future of Credit Management: Digital, Data-Driven & Intelligent


That future isn’t as far off as you might think.

More businesses are using solutions driven by artificial intelligence (AI) to transform the way they manage credit. AI uses computer systems to automate repetitive tasks and to collect and analyze large data sets to identify customer payment behaviors, make decisions, and learn over time.

AI shouldn’t be confused with robotic process automation (RPA), technology that is adept at “doing.” While RPA replicates simple, rules-based tasks, AI takes automation to the next level.

AI-driven solutions are a far cry from the process most businesses use to manage credit.

Many credit professionals rely on spreadsheets or multiple spreadsheet workbooks, combined with the dunning process in their enterprise resource planning (ERP) allocation, to manage their debtors. Some may be using outdated on-premise collections systems that are at the end of their life.

Credit professionals must sort through data from multiple systems to fully understand a debtor’s situation. With this information in hand (literally, in some cases), credit professionals typically work through their debtors, starting with their company’s largest customers, with the greatest overdue debt.

This antiquated approach to managing debtors makes it hard to segment customers or to effectively manage so much data, gleaned from so many sources, and covering so many customers, in real time. What’s more, spreadsheets and the dunning processes contained in ERPs offer credit control departments few opportunities to customize workflows to treat debtors in an individualized way.

AI transforms credit management, making it more digital, data-driven, and intelligent.

AI Makes Credit Management More Digital

Digitizing credit management with AI-driven solutions eliminates the low-value manual tasks that consume so much of the typical credit professional’s day.

Workflows are digitized and customized for each customer. Statements and overdue letters are generated and delivered electronically based on intelligent profiling.

Customer calls are automatically prioritized based on historical data and information from third-party agencies and others.  Credit professionals are alerted when action is required or when a payment trend changes.

AI Makes Credit Management More Data-Driven

AI-driven solutions make it easy for everyone in the organization to know what’s happening with customer credit. Customer credit information is aggregated from credit reference agencies, insurers, and others.

Credit professionals get a real-time view of debt and collected debts are tracked in real time. Promises to pay are immediately recorded in the system. Customer information is stored in one place, eliminating the need to maintain multiple spreadsheets or to collate or distribute reports to enterprise stakeholders.

Managers can see the effect each call made by their collection team had on month-end debt. And bank reconciliations can be completed in as little as three minutes, compared to the arduous three- or four-day financial close process that most credit professionals now endure.

AI Makes Credit Management More Intelligent

Credit professionals are under pressure to achieve cash targets. By analyzing historical data and customer payment behaviors (e.g., a customer always pays on the 15th of the month), AI-driven solutions enable credit professionals to more accurately forecast cash flow and realign collections resources to target customers whose behavior is uncertain.

AI-driven solutions simplify processes, eliminate opportunities for errors, and speed cycle times.

Far from being a threat, AI represents a big opportunity for credit professionals. It provides the insights that credit professionals need to make better-informed decisions, faster. By automating manual tasks, credit professionals will be free to spend more time on value-added activities such as data analysis, customer management, and collaborating with stakeholders across the enterprise.

Businesses benefit from better cash flow and less debt. But none of these benefits are assured unless you work with a solutions provider that understands how credit management works and has a proven track record in delivering AI-driven solutions.

Managing credit is a fundamental process for every business. But issuing and recovering debt doesn’t have to be a burden. AI is empowering businesses to manage their credit process in a more digital, data-driven, and intelligent manner.

Is your F&A organization ready to leave its spreadsheets behind? Get started here.