Virgin Money embraces AI to tackle credit card churn

Virgin Money has turned to Jaywing’s artificial intelligence product, Archetype, to gain a deeper understanding of its credit card customers in an effort to improve the customer experience and enhance risk modelling.
By using the scheme, it is claimed that Virgin Money is able to identify which customers are most likely to consider switching credit card provider with more accuracy than ever before.
This enables the bank to tailor marketing and promotional offers based on individual customer circumstances, improving the customer experience and reducing the likelihood of customers deciding to switch providers.
In trials, compared with existing models (built on the same data sample), it is claimed that Archetype delivered a double-digit improvement in the ability to predict customers most likely to leave.
Jaywing also ran a proof of concept to demonstrate the potential of Archetype’s AI capabilities to enhance credit risk models.
Virgin Money has already built a high-quality credit card book with the existing scorecard approach. Running alongside this traditional risk model, the Archetype model combined internal data and bureau information to demonstrate the potential for AI to even more accurately assess credit risk and predict low risk applications.
More precise profiling of applications provides the ability to make even more accurate lending decisions, with the potential to reduce bad debt while taking on more customers, Jaywing insists.
Virgin Money credit cards head of analytics Nick Martin said: “AI is clearly a technology with immense potential, and we wanted to test the ways in which it can provide practical support to our team by improving the customer experience, increasing the effectiveness of marketing for our credit card customers and enhancing our credit risk processes.
“We were impressed with the results from Archetype and are now exploring how we can incorporate it further within our business.”