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Case Study: Intelligent Finance CCA changes
This study describes Arum's engagement with Intelligent Finance (IF) and St James's Place Bank in 2008, upgrading the compliance of the Banks' Debt Manager and related systems. This requirement arose when updates were made to the existing Consumer Credit Act (1974), these changes came into force on 1 October 2008.
The Challenge
In Autumn 2008, the Consumer Credit Act (1974) was updated, introducing new compliance rules. The challenge was to amend the Debt Manager associated systems in line with these new rules in time for the CCA compliance deadline. Failure to do this could potentially lead to IF not being able to enforce the collection of the debt, which could result in loss of potential revenue.
The Outcome
The project was completed within the timescale set and also delivered additional functionality over and above the CCA requirements. The enhanced business processes and functional changes concerning collections activity were delivered on time with minimal disruption to business-as-usual operations. During the project lifecycle a full knowledge handover of project changes was given to the business as well as spending time assisting with general Debt Manager issues raised by the business.
How did Arum achieve this successful outcome?
We did it by understanding IF's business needs and working closely with the IF project team to coordinate all areas of development and implementation. Key to the success were the relationships built up by our consultants with both the technical and business teams within Intelligent Finance. The cooperation between all teams was very positive. Our known high level of collections and recoveries experience and the Debt Manager skills of our staff were vital to producing a realistic timeframe for the changes, ensuring continuity of the collections business and managing the expectations of IF's project management team.
Here's how we resolved our challenge. A prerequisite is homework on company background to gain an understanding of the customer.
THE PROJECT
Organisation Background
Intelligent Finance (IF) and St. James's Place Bank are divisions of HBOS plc. The bank enables customers to offset their borrowings against their savings and is the largest offset banking provider in the UK. The bank operates out of two facilities in Scotland - one in Livingston, West Lothian and the other in Rosyth, Fife.
IF and St James's Place Bank offer a range of banking services over the telephone or online.
Project Background
The Consumer Credit Act (CCA) 2006 was part of a three-year programme by the Department for Trade and Industry (DTI) to review consumer credit law and where necessary introduce changes. These changes are reforms to the existing Consumer Credit Act 1974 and continue to protect consumers and create a fairer, more competitive credit market. The changes came into effect on 1 October 2008.
The Act is centred round three key areas:
- Ensuring consumers are provided with clear information about the state of their credit accounts
- Improving consumers' rights and access to redress by empowering consumers to challenge unfair lending
- Establishing a more targeted licensing regime for the regulation of consumer credit business
The objective of the project was to ensure that the collections department complied with these change areas in order to allow IF and St. James's Place Bank collections team to continue to remain compliant, thereby allowing them to enforce the debt should further action be required.
To achieve compliance, a number of updates needed to be made to processes and systems including the introduction of two new Debt Manager processes which required amendments to the application. The project included:
- Analysis and specification of new processes
- Development of all changes to software
- Specified changes to in-house interfaces
- Design and management of early testing phases
Project Aims
The key aim was to ensure that the processes of the collections department complied with the new regulatory requirements by 1 October 2008.
Continued systems operation (BAU) should be maintained as far as possible.
Project Challenges
This was only the second large collections process change since the original Debt Manager implementation in 2001 and the first major change to the product since the FSA Mortgage changes in 2004. There had not been a significant level of change in the intervening period and, as key staff had left since that implementation, there was a lack of Debt Manager knowledge within IF, with the exception of a stretched support team. It was however a requirement that the project should not lean heavily upon these business-as-usual support personnel. Also the changes that were required were not to impact upon the business team if at all possible.
When the Arum team arrived onsite the project had already moved past the business requirements and initial functional specification stage therefore the team had to work within the already specified project scope. As the project was working to a drop dead project date of 1 October 2008 to ensure business compliance, timescales for delivery were extremely tight. During the period of the project a number of key project personnel left IF and therefore the new project members had to be brought up to speed very quickly.
The Debt Manager Application was dependent upon data feeds to/from one legacy host system and data integrity was of paramount importance to complying with the processes defined in new routers.
Also the new documentation which was being introduced required additional information to be stored in Debt Manager to allow population of the new templates.
Arum's Role
Arum Systems provided skilled Debt Manager consultants to work on the functional, development and testing aspects of the project and they were also key in ensuring that batch performance incurred no impact after changes were made. Mini-workshops were run to discuss a number of areas not highlighted in the original requirements during the project. During the testing phase the Arum team provided support to the test team both in terms of defect fixing and Debt Manager processes.
IF also used our consultants to assist the business above and beyond the role of the project. Our team provided expert advice on other Debt Manager related issues during the length of the engagement together with improving IF staff knowledge of Debt Manager.
Arum was selected for this engagement because of the known high level of collections and recoveries and Debt Manager skills of our staff. Other key factors were the high quality of our consultants and the fact that we had previously delivered high quality consultancy for IF.
IF viewed engaging Arum as crucial way of reducing the risk to delivery of this critical project.
Project Delivery
- The project was completed within the timescale set and also delivered additional functionality over and above the CCA requirements.
- The enhanced business processes and functional changes concerning collections activity were delivered on time with minimal disruption to business-as-usual operations.
- During the project lifecycle a full knowledge handover of project changes was given to the business.
- Time was also spent assisting with general Debt Manager issues raised by the business.
Both Intelligent Finance and St James's Place Bank were compliant within the FSA timescale and this was achieved with little disruption to the continuing operation.
Further Details
Please contact Malcolm Collett for further details.
malcolm.collett@arum.co.uk
Tel +44 (0)870 383 1980
