Why Use Muscle? Big Data Can Collect Debt
Bringing in the heavies over a few late payments is likely to lose a customer forever. Artificial intelligence is proving a better way.
An Indian farmer watches the national budget speech on his smartphone.
Photographer: Subhankar Chakraborty/Hindustan Times/Getty Images
A 2021 remake of Get Shorty might not have much use for John Travolta’s Miami mobster character. The debt collector role could go to a bot.
You can test this hypothesis in a most unlikely place to roll out a new technology: the Indian countryside. The setting is perhaps not as odd as it seems, with about 5% to 10% of the country’s farmers not repaying their tractor loans on time. The explanations for tardiness range from failed crops to medical emergencies and strategic defaults in anticipation of state-mandated debt waivers, a regular feature of the political economy.