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Reducing Past Due Ratio

Reducing Past Due Ratio. An Extra Mile. Some Ideas. Target a realistic goal to reduce past due in absolute amount or percentage. For example – reduce past due from 38% to 28% within 6 mos. In absolute amount, from P3.8 million to P2.8 million.

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Reducing Past Due Ratio

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  1. Reducing Past Due Ratio An Extra Mile

  2. Some Ideas • Target a realistic goal to reduce past due in absolute amount or percentage. For example – reduce past due from 38% to 28% within 6 mos. In absolute amount, from P3.8 million to P2.8 million. • Rank the past due in terms of absolute amounts – Outstanding past due broken down in terms of Principal, Advances, Interest, and Penalties. Indicate per cent to total past due. If you can indicate major cause/s of past due.

  3. Some Ideas……. • Analyze major cause/s of past due. - Could you prioritize causes in terms of seriousness or gravity? - Could you indicate under remarks column any solution/s in sight? If you don’t know, consult the AO supervising the account.

  4. Some Ideas……. • Classify the past due accounts according to the causes identified. • Brainstorm with the AOs possible ways of reducing past due: - Do the borrowers need a little time to settle the account? - Will reamortizing the loan balance help client pay the loan?

  5. Some Ideas……. - Giving incentives to fully or substantially) paying the past due with proportionate reduction in penalties. - Mass restructuring of accounts with the new terms being approved by the board. - Using moral suasion in a collection campaign. - Appealing to whatever will move them to pay.

  6. Some Ideas……. • Give incentives to bank staff through a collection campaign. • Implement and measure results. • Review and see where improvements could be done. • Review policy changes that should be effected based on causes of past due identified.

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