delinquency management - · pdf filedelinquency management. causes vs. myths (continued)...
TRANSCRIPT
2011 GSA SmartPay® Training Conference
Delinquency Management
Sabrina Dyer Vice President, Citi
®
A Winning Hand: Solutions, Savings and Sustainability with GSA SmartPayThe 13th Annual GSA SmartPay Training Conference, Las Vegas
®
3
House Rules
®
Delinquency Management
Federal Audiences
To ensure the best possible learning experience for participants, please adhere to the following house rules:
• Turn cell phones and pagers to vibrate• Hold questions to end of session• Ensure your participant badge is scanned to receive CLP credits− For each course− Must leave room and reenter
• Take advantage of opportunities to provide feedback − Please select the Citi Q&A icon on any Citi PC at the conference− Answers to be e-mailed after the conference within 60 days
4
This course is designed to assist you in achieving the following objectives:
• To provide information for new and existing AOPCs on how to best manage and minimize delinquency in your Individually Billed Travel/Purchase Card Program
Goals & Objectives
®
Delinquency ManagementDepartment of
DefenseFederal Audiences
5
Agenda
®
Delinquency Management
Federal Audiences
Delinquency Overview
Delinquency Timeline/Critical Dates
Common Causes of Delinquency/Myths
Citi Collection Efforts
Delinquency Management Reports/Tools
Best Practices/AOPC Controls
Current Component Results
Summary
Q&A/Contact Info
1. Delinquency Overview
®
Delinquency Management
6
7
Delinquency Overview
Delinquency Management
Cards are individual liability– Individual cardholders are responsible for the
timely payment of balance upon receipt of billing statement
GSA Contract requires use of Card for approved government expenditure– Cardholder is only reimbursed for “official”
government purchases; personal use of card IS NOT allowed
Cardholder payment options– Split disbursement
®
Federal Audiences
Delinquency Overview
Delinquency Management (continued)
Payment Type Method to Submit Payment
Checks Citibank Govt Card Services, P.O. Box 183173 Columbus, OH. 43218-3173
Wire Payments post in 24-48 business hours
Payment by Phone
Cardholder can call 1-800-473-1393 to pay-by-phone through their personal checking account
Cardholder Statements & Payments (CSP)
Cardholder can make an online payment using their personal DDA account – free of charge at home.cards.citidirect.com
®
Federal Audiences
8
2. Delinquency Timeline Overview
®
Delinquency Management
9
10
Delinquency Management
Delinquency Management
®
Account Delinquency– GSA contract references the number of days past the
cycle date; “clock” starts ticking when the account cycles and a statement is generated with a balance owing
“Critical Timelines/Events”– Account is suspended from use at 66 days past
billing (2 statement cycles w/o a full payment or 36 days past due); account will automatically unsuspend with payment of full past due amount
– Account is canceled (permanently closed) at 131 days past billing; cardholder has received (5) letters, (5) statements, and numerous calls from a Citi Collections Specialist to attempt a reasonable payment arrangement
– Account will report to cardholder’s personal credit bureau at 151 days past billing
Federal Audiences
11
Delinquency Management
Delinquency Management (continued)
®
“Critical Timelines/Events” (continued)– Accounts are canceled when (2) NSF checks are
received within a 12-month period
– Reinstatement is not guaranteed, only for extenuating circumstances AOPC must submit a written request to their Client
Service Officer Letter from cardholder explaining circumstances of
cancellation Citibank collections management reviews the
information and determines eligibility Account can only be reinstated (1) time in history of
the account
Federal Audiences
Delinquency Management
Delinquency Management – Activity Matrix
®
Days Past Billing
ActivitySystem Generated Letter Events
0 Original Cycle Date
25 Original Payment Due Date
30 2nd Cycle
45 Past Due Letter
55 Pre-Suspend Letter
66 Suspend Letter Account Suspends
121 Pre-Cancellation Letter
126 Late Fees begin/continue every 30 days until charge off
131 Cancellation Letter Account Cancels/Closes
151 Reports to Personal Credit Bureau
211 Account Charges Off/Continues to Reports to Personal Credit Bureau
Federal Audiences
12
3. Common Causes of Delinquency / Myths
®
Delinquency Management
13
14
Delinquency Management
Causes vs. Myths
Late or non-submission of expense reports– During travel/TDY
Slow/manual reimbursements by agency
Unclear on policy and/or procedures – Training is available on the GSA SmartPay website
NSF returned checks
Employee misuse– Spending reimbursement– Excessive personal card use– Overspending per diem
Improper handling of a dispute
Causes
®
Federal Audiences
15
Delinquency Management
Causes vs. Myths (continued)
Bankruptcy– Belief that card will not be affected– Belief that agency is unable to assist
Account management– Belief that account will not report to personal Credit Bureaus– Belief that they can use card for personal use – Card is not a Personal credit card it
can only be used for approved government expenses
®
Myths
Federal Audiences
4. Citi Collection Efforts
®
Delinquency Management
17
Delinquency Management
Collection Letters
®
Past due letter (Sent at 45 days past billing)– Advises account is currently past due and to pay
immediately to avoid suspension of charging privileges
Pre-suspend letter (Sent at 55 days past billing)– Advises account is past due and if payment is not
sent within (5) days of the date of the letter, charging privileges will be suspended
Suspend letter (Sent at 66 days past billing)– Advises charges privileges have been suspended
due to non-payment. States account will automatically be reinstated when payment for past due amount has been received
Federal Audiences
18
Delinquency Management
Collection Letters
®
Pre-cancel letter (Sent at 120 days past billing)– Advises account is currently suspended and if
payment is not received immediately the account will be subjected to cancellation, late fees, and possible negative reporting to personal credit bureau.
Cancellation letter (Sent at 131 days past billing) – Advises the account has been canceled and will be
reported to personal credit bureau and do not attempt to use card.
Federal Audiences
19
Delinquency Management
Collection Calls
®
Cardholder is contacted by a Collection Specialist beginning at 61 days past billing. The goal at this stage is to resolve the delinquency
Calls will continue until payment and/or acceptable arrangements have been made; frequency of calls is determinate upon call response, account balance and follow-through on prior promise to pay arrangements
Federal Audiences
20
Delinquency Management
Collection Calls
®
The Collection Specialist will attempt to resolve the delinquency by discussing available payment options, including post dating over the phone payments.
Once account charges off, it may be referred to a third party collection agency and/or legal network to pursue more stringent collection efforts
Account reports to cardholder’s personal credit bureau at 151 days past billing cycle
Federal Audiences
Delinquency Management
Citi Collection Efforts – Salary Offset
®
• Accounts are targeted at 91 days past billing for agencies participating
• Letters are sent to the cardholder offering a payment option to avoid Salary Offset
• Late fees are stopped for accounts participating in Salary Offset but account continues to age– Accounts participating in Salary
Offset are not sent to outside collection agencies
Federal Audiences
21
5. Best Practices/AOPC Controls
®
Delinquency Management
22
23
Delinquency Management
Managing Delinquency
®
Utilize Cardholder Statements & Payments Option– Easier access while traveling– Payments made via online post faster than mailing and
is free – Can view current statement – Can view statement history (prior statements)– Can view unbilled transactions to get head start on
filing vouchers
Travel Policy and Compliance– Maintain a consistent card use policy – educate
cardholders frequently– Create, communicate, and exercise penalties for
misuse and/or abuse of program– Educate cardholders to file travel vouchers as soon as
possible
Federal Audiences
24
Delinquency Management
Managing Delinquency
®
Maximize Card Control– Audit for unnecessary MCC’s regularly – utilize the
Block MCC Report– Minimize credit limits (cash and purchase) as
appropriate– Close accounts when no longer employed
Utilize Citi Online Reporting Tools– Monitor spending and payment history for accounts– Empower AOPCs to take action against delinquent
cardholders
Federal Audiences
6. Delinquency Management Reports/Tools
®
Delinquency Management
25
26
Delinquency Management
Citibank Custom Reporting System (CCRS)
Delinquency Report
Pre-Suspension Report
Non Travel Related Activity Report
Account Activity Report
Declined Authorizations Report
Block MCC Report
CCRS provides access to detailed and easy-to-use reports to assist you with managing delinquencies within your hierarchy
®
Federal Audiences
27
Delinquency Report
The Delinquency Report provides account information at a specified hierarchy for any account holder considered past due on their card.
Delinquency Management
®
Account Name
Account Status
SSN
Last Pmt Date
Qualifier
Current Bal.
Pmt Due Date
Past Due Amt
Pmt. Amt. CTD
30 DayPast Due
60 Day Past Due
Federal Audiences
28
Pre-Suspension Report
The Pre-Suspension Report lists accounts that are between 45 and 60 days past billing cycle within a specified hierarchy.
Delinquency Management
®
HierarchyLevel 5 & 7
Account Status
SSN
Account Name
Pmt. Due Date
Past Due Amt
Days Past Due
Metrics
Last Statement Balance
Federal Audiences
29
Suspension Detail Report
The Suspension Detail Report lists accounts that have been suspended and are eligible for cancellation. Accounts appear on this report at 61 – 125 days past the billing cycle date.
Delinquency Management
®
Account Number
Account Status
SSN
Account Name
Days Past Due
Date Suspended
Last Statement
Bal.
Number of Times Suspended Past
YearMetrics
Past DueAmt.
Federal Audiences
30
Non-Travel Related Activity Report
The Non-Travel-Related Activity Report provides information to identify account holders with transaction activity (such as cash, fuel, or food) occurring without other associated travel activity (such as airline, car rental or lodging).
Delinquency Management
®
Account Number
Account Name
Current Balance
Transaction Date
Merch.City
Merchant Name Merch.State
MCC
Metrics
Total Trans Amount
Federal Audiences
31
Account Activity Report
The Account Activity Report provides detailed information regarding transactions for each account within a specified hierarchy level.
Delinquency Management
®
Account Name 1
Account Name 2
Account Type
Account Type
Transaction Date
TransPost Date
Merchant Name
Merch.City
MCC
Merch.State
Federal Audiences
32
Declined Authorization Report
The Declined Authorizations Report lists all attempted transactions and details reasons for decline and type of purchase within a specified hierarchy.
Delinquency Management
®
Account Name 1
DeclineDate
DeclineTime
Primary Dec. Reason
Decline Reason 1
DeclineReason 2
Merch. City
Account Number
Federal Audiences
33
Blocked MCC Report
Delinquency Management
®
Transaction Date
Transaction DB-CR Indicator
MCC
Merchant Name MCC
Description
Transaction Post Date
The Blocked MCC Report shows all attempted transactions against excluded or restricted Merchant Category Codes (MCC).
Federal Audiences
7. Current GSA Results
®
Delinquency Management
34
Delinquency Management
Current GSA Delinquency Results
Delinquency Rates as of 7/29/11
®
Delinquency management within the Agencies has been improving
Collections Unit observations indicate increased personal usage among cardholders
Delinquency as a % of Total Spend $ = 6%
Delinquent $ Spend $
$16,213,217 $264,705,720
Delinquency is defined as accounts >31 days past due or 61 days past billing
Federal Audiences
Current Component Salary Offset Results
Data as of 07/29/2011
Salary Offset
# $
Labor 3 $6,260.00
SSA 4 $9,322.00
State 4 $15,312.00
IRS 6 $21,307.00
HUD 1 $1,140.00
GSA 3 $3,340.00
Total 21 $56,681.00
Delinquency Management
®
Federal Audiences
8. Summary
®
Delinquency Management
38
Delinquency Management
• Delinquency management is everyone’s responsibility
• Implementing best practices is key to a successful program
• Improved delinquency management results in higher rebates and improved program integrity
• Citi is dedicated to making this process work for you!
Remember…
®
Federal Audiences
Delinquency Management
Contact Information
®
DepartmentContact Numbers
Hours of OperationToll-Free Collect
Client Account Service
(866) 836-5011 (904) 954-7580 Monday – Friday7:00 AM to 9:00 PM EST
Collections (800) 473-1393 (904) 954-7580 Monday – Friday8:00 AM – 9:00 PM EST
Cardholder Customer Service
(800) 790-7206 (904) 954-7580 24 hours a day; 7 days a week
Federal Audiences
39
®
Schedules Available at the Welcome Center Federal Audiences
Delinquency Management
40
Delinquency Management
Sabrina Dyer
®
Federal Audiences
42
Thank you for attending!
Visit the Citibank Welcome Center– Level 3 Foyer – West– National Industries for the Blind will have a
display of products– Conference Slide Show – come see yourself
shine!
Visit the Citibank One-on-One Lab – Lido 3101 A/B
Visit the Citibank Mini Sessions – Lido 3001 A/B
Citi Q&A link – Tell us your thoughts
®
Reminders Federal Audiences
Delinquency Management
43
®
Interactive Training Events
Delinquency Management
Federal Audiences
Citi offers Computer Based Training (CBT) via the Citi Commercial Card Learning and System Support (CLASS) in CitiManager.
Visit home.cards.citidirect.com and from the Web Tools tab select the CLASS link
Please contact your Account or Client Manager if you are interested in setting up a training session. Training can be conducted at a Citi Training Location, on-site at your office or via the Web.
Regional Citi Training Locations– Norfolk, VA– Washington, DC
Terms & Disclosures
Tuesday, July 28, 2009
®
IRS Circular 230 Disclosure: Citigroup Inc. and its affiliates do not provide tax or legal advice. Any discussion of tax matters in these materials (i) is not intended or written to be used, and cannot be used or relied upon, by you for the purpose of avoiding any tax penalties and (ii) may have been written in connection with the "promotion or marketing" of any transaction contemplated hereby ("Transaction"). Accordingly, you should seek advice based on your particular circumstances from an independent tax advisor.
Any terms set forth herein are intended for discussion purposes only and are subject to the final terms as set forth in separate definitive written agreements. This presentation is not a commitment to lend, syndicate a financing, underwrite or purchase securities, or commit capital nor does it obligate us to enter into such a commitment. Nor are we acting in any other capacity as a fiduciary to you. By accepting this presentation, subject to applicable law or regulation, you agree to keep confidential the existence of and proposed terms for any Transaction.
Prior to entering into any Transaction, you should determine, without reliance upon us or our affiliates, the economic risks and merits (and independently determine that you are able to assume these risks) as well as the legal, tax and accounting characterizations and consequences of any such Transaction. In this regard, by accepting this presentation, you acknowledge that (a) we are not in the business of providing (and you are not relying on us for) legal, tax or accounting advice, (b) there may be legal, tax or accounting risks associated with any Transaction, (c) you should receive (and rely on) separate and qualified legal, tax and accounting advice and (d) you should apprise senior management in your organization as to such legal, tax and accounting advice (and any risks associated with any Transaction) and our disclaimer as to these matters. By acceptance of these materials, you and we hereby agree that from the commencement of discussions with respect to any Transaction, and notwithstanding any other provision in this presentation, we hereby confirm that no participant in any Transaction shall be limited from disclosing the US tax treatment or US tax structure of such Transaction.
We are required to obtain, verify and record certain information that identifies each entity that enters into a formal business relationship with us. We will ask for your complete name, street address, and taxpayer ID number. We may also request corporate formation documents, or other forms of identification, to verify information provided.
Any prices or levels contained herein are preliminary and indicative only and do not represent bids or offers. These indications are provided solely for your information and consideration, are subject to change at any time without notice and are not intended as a solicitation with respect to the purchase or sale of any instrument. The information contained in this presentation may include results of analyses from a quantitative model that represent potential future events that may or may not be realized, and is not a complete analysis of every material fact representing any product. Any estimates included herein constitute our judgment as of the date hereof represent potential future events that may or may not be realized, and are not a complete analysis of every material fact representing any product. Any estimates included herein constitute our judgment as of the date hereof and are subject to change without any notice. We and/or our affiliates may make a market in these instruments for our customers and for our own account. Accordingly, we may have a position in any such instrument at any time.
Although this material may contain publicly available information about Citi corporate bond research, fixed income strategy or economic and market analysis, Citi policy (i) prohibits employees from offering, directly or indirectly, a favorable or negative research opinion or offering to change an opinion as consideration or inducement for the receipt of business or for compensation and (ii) prohibits analysts from being compensated for specific recommendations or views contained in research reports. So as to reduce the potential for conflicts of interest, as well as to reduce any appearance of conflicts of interest, Citi has enacted policies and procedures designed to limit communications between its investment banking and research personnel to specifically prescribed circumstances.
© 2011 Citibank, N.A. All rights reserved. Citi, Citi Arc Design, CitiDirect, CitiManager, Citibank Custom Reporting System, and Citibank Electronic Reporting System, are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.
In January 2007, Citi released a Climate Change Position Statement, the first US financial institution to do so. As a sustainability leader in the financial sector, Citi has taken concrete steps to address this important issue of climate change by: (a) targeting $50 billion over 10 years to address global climate change: includes significant increases in investment and financing of alternative energy, clean technology, and other carbon-emission-reduction activities; (b) committing to reduce GHG emissions of all Citi owned and leased properties around the world by 10% by 2011; (c) purchasing more than 52,000 MWh of green (carbon neutral) power for our operations in 2006; (d) creating Sustainable Development Investments (SDI) that makes private equity investments in renewable energy and clean technologies; (e) providing lending and investing services to clients for renewable energy development and projects; (f) producing equity research related to climate issues that helps to inform investors on risks and opportunities associated with the issue; and (g) engaging with a broad range of stakeholders on the issue of climate change to help advance understanding and solutions. Citi works with its clients in greenhouse-gas-intensive industries to evaluate emerging risks from climate change and, where appropriate, to mitigate those risks.
44
© 2011 Citibank, N.A. All rights reserved. Citi, Citi and Arc Design and CitiDirect are trademarks and service marks of Citigroup Inc., used and registered throughout the world.
®