Automating Credit and Collections Decisions at AT&T Capital Corporation

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.