delinquency management - citibank · 15 delinquency management common causes of delinquency...

2011 GSA SmartPay® Training Conference

Delinquency Management

Deanne BurbeeSenior Vice President, Citi

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A Winning Hand: Solutions, Savings and Sustainability with GSA SmartPayThe 13th Annual GSA SmartPay Training Conference, Las Vegas

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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

House Rules


DoD Travel

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This session is designed to assist you in achieving the following goals:

• To provide information for new and existing AOPCs on how to best manage and minimize delinquency in your Individually Billed Travel Card Program

Goals & Objectives

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Goals & Objectives DoD Travel

Delinquency Overview

Delinquency Timeline/Critical Dates

Common Causes of Delinquency

Citi Collection Efforts

Best Practices/AOPC Controls

Delinquency Management Reports/Tools

Current DoD Travel Card Results

Summary

Q&A/Contact Info

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1. Delinquency Overview

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Delinquency Overview

Cards are individual liability– The cardholder is solely responsible for the

timely payment of balance upon receipt of billing statement

GSA Contract requires usage of the card for all government travel– Cardholder is only reimbursed for “official”

Government Travel; personal use of card IS NOT allowed

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Cardholder payment options– Split disbursement (mandatory for Active Duty military)– Alternative payment options

– Additional payment information is available online at www.citimanager.com/dodhomeunder Resources; APC Guides; Payment Options Guide

Reimbursement questions/issues contact DFAS Travel Assistance Center at 1-888-HELP1GO

Delinquency Overview (continued)

Payment Type Method to Submit Payment

Checks Citibank Gov’t Card Services, P.O. Box 183173, Columbus, OH 43218-3173

Wire If made before 1:00 PM EST, should post the same business day

ACHCardholder can call 1-866-670-6461 to pay-by-phone through their personal DDA account – free of charge

Cardholder Statements & Payments (CSP)

Cardholder can make an online payment using their personal checking (DDA) account – free of charge

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2. Delinquency Timeline Overview

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Delinquency Timeline Overview

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– 61 Days Past Billing = Account suspension Account reopens after posting of full past due

payment– 75 Days Past Billing = Late Fee Assessed $29.00

– 126 Days Past Billing = Account cancellation(permanently closed) Cardholder has received (6) letters, (5) statements

and numerous calls from a Citi Collections Specialist to attempt a reasonable payment arrangement ®

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Delinquency Timeline Overview (continued)

Approximately 126+ Days Past Billing – Account sent to DFAS for Salary Offset processing

211 Days Past Billing (charge off) = Reported to Cardholder’s Personal Credit Bureau; and may be referred to Collection Agency or Attorney for additional Collection efforts

Additional Account Cancellation Scenarios:

(2) NSF checks within (12) month period

Reinstatement: Reinstatement is not guaranteed, must meet eligibility criteria AOPC submits Reinstatement Application to (866) 951-8005. If application is…

– Approved: $29 reinstatement fee applied on first statement; Account will be re-opened as a restricted card ($4,000 credit limit)

– Denied: Should wait 60 days to reapply

– One reinstatement permitted in life of account

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Delinquency Timeline Overview

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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

61 Suspend Letter Account Suspends

91 Due Process/RPP Letter 100

121 Pre-Cancellation Letter

126 Cancellation Letter Account Cancels/Closes

Salary Offset File sent to DFAS

131 Salary Offset Inbound File from DFAS

211 Account Charges Off/Reports to Personal Credit Bureau

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Delinquency Fee Timeline

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Days Past Billing

Activity

Fee Type Fee Amount

0 Original Cycle Date25 Original Payment Due Date30 2nd Cycle75 1st Late Fee $29

105 2nd Late Fee $29

126+ Salary Offset Fee $80

135 3rd Late Fee $29

165 4th Late Fee $29

195 5th Final Late Fee $29

Assuming the cardholder does not make a full past due payment, the total fees assessed on the account prior to charge-off total $225

Without a full payment of the past due amount, fees will continue to be assessed each statement cycle until the account charges off

Payment of full past due amount prior to due date will prevent subsequent Late Fees

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3. Common Causes of Delinquency

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Common Causes of Delinquency

Slow/manual reimbursements by agency– DTS “issues”– DTS “kicking claim back without cardholder being notified”– DTS/Cardholder issue of not selecting Split Disbursement option

Late or non-submission of travel vouchers– “Still on travel have not yet filed”– Waiting on final levels of approval– Change in Duty Station (PCS) or (TDY)

NSF returned checks Unclear on policy and/or procedures

– DoD 101 – Travel Card Training is available on the GSA-SmartPay website

Employee misuse– Spending reimbursement vs. paying Travel Card– Using card for personal use/Miscalculating Per Diem

Causes

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Common Causes of Delinquency – (continued)

Causes

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Cardholders believe that: They don’t have to pay until after they are reimbursed They don’t have to pay/file voucher until after they return from travel They are not responsible for late fees or salary offset fees The account will not report to personal Credit Bureaus They can use Card for personal use – Card is not a Personal credit card, it is a

Government Travel Card

Separated Military Cardholders believe that: Balance is no longer their responsibility, especially if balance includes fees Once discharged from the DoD that collections efforts will cease APC/prior Command is unable to assist Citi with Cardholder information

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4. Citi Collection Efforts

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Citi Collection Efforts – 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 (6) days of the date of the letter, charging privileges will be suspended

Suspend letter (Sent at 61 days past billing)– Advises charging privileges have been

suspended due to non-payment. States they will automatically be restored when payment for past due amount has been received

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Citi Collection Efforts – Collection Letters (continued)

Pre-cancellation/Due Process Letter (Sent at 91 days past billing)– Advises account is currently suspended and

subject to cancellation if payment not received within (6) days. References the potential for salary offset, and if there are any extenuating circumstances that prevent payment to contact your AOPC immediately

Cancellation Letter (Sent at 126 days past billing) – Advises that account has been canceled and will

be added to the “Cancellation Report” that will be viewed by their AOPC and Commanding Officer/Supervisor. Also advises that their account will be sent for Salary Offset consideration

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Citi Collection Efforts – Collection Calls

Cardholder is contacted by a DoD 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

The DoD Collection Specialist will attempt to resolve the delinquency by discussing available payment options, including Reduced Payment Programs

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Citi Collection Efforts – Collection Calls (continued)

Once account charges off, it may be referred to a third party Collection Agency and/or legal network to pursue more stringent collection efforts

Upon charge off (211 days past billing) the account reports as a R9 charge-off on cardholder’s personal bureau

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Citi Collection Efforts – Statement Messages

# Days Past Billing Statement Message

31 – 60“We did not receive your payment last month. Please pay the total balance due at once. If you have remitted payment, please disregard this notice.”

61 – 90 “Your account is past due and your charging privileges have recently been suspended. Please pay the past due balance immediately.”

91 – 120“Your account is seriously past due and may be canceled and submitted for Salary Offset if a payment is not received within 30 days. Please contact us at 1-866-670-6461 to discuss payment options.”

121 – 150

“Your account is seriously past due and may be canceled and submitted for Salary Offset if a payment is not received immediately. Please call 1-866-670-6461 to pay by phone or visit home.cards.citidirect.com to make an online payment.”

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Citi Collection Efforts – Statement Messages (continued)

# Days Past Billing Statement Message

151 – 180

“Your past due account has been canceled and submitted for Salary Offset. You are still responsible for ensuring your balance is paid in full. Please call 1-866-670-6461 to pay by phone or visit home.cards.citidirect.com to make an online payment.”

181 – 210

“The past due balance on your canceled account has not been paid in full. Please be aware you are still responsible for ensuring your past due balance is paid in full, even if your account may have been submitted for Salary Offset. Please call 1-866-670-6461 to pay by phone or visit home.cards.citidirect.com to make an online payment.”

Charge – Off

“The past due balance on your canceled account has not been paid in full and may now be reported to the credit bureaus. Please call 1-866-670-6461 to pay by phone or visit home.cards.citidirect.com to make an online payment.”

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Varying RPP programs have been created to assist Cardholders with their individual financial situations

Citi Collection Efforts – ReducedPayment Program

RPP Programs

(2) MonthCommitment from Cardholder is that they can resolve delinquency (past due amount within two statement cycles); monthly late fees will be assessed while on this program; only available prior to cancellation; account could remain open for use

(3) MonthCommitment from Cardholder is that they can resolve delinquency (past due amount within three statement cycles); a one-time enrollment fee of $45 is assessed; a monthly $10 RPP fee and monthly late fees ($29) are assessed while on this program; account may cancel while on this program determinate upon delinquency stage at enrollment

(6) MonthCommitment from Cardholder is that they can resolve delinquency (past due amount within six statement cycles); a one-time enrollment fee of $45 is assessed; a monthly $10 RPP fee and monthly late fees ($29) are assessed while on this program; account may cancel while on this program determinate upon delinquency stage at enrollment

(9) MonthCommitment from Cardholder is that they can resolve delinquency (past due amount within nine statement cycles); a one-time enrollment fee of $45 is assessed; a monthly $10 RPP fee and monthly late fees ($29) are assessed while on this program; account may cancel while on this program determinate upon delinquency stage at enrollment

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There are three potential Salary Offset responses from DFAS that would determine eligibility of a member. They are as follows:

Citi Collection Efforts – Salary Offset

DFAS Salary Offset Outcomes

EnrolledAccount has been reviewed and approved by DFAS for enrollment into Salary Offset. Enrollment fee of $80 and up to (3) Late Fees ($29 each) are assessed (Total of $167 in fees offset by DFAS).

Future Eligible

Account has been reviewed, but currently cannot be enrolled into Salary Offset. The account may be eligible for enrollment in the future.

Not Eligible

Account has been reviewed by DFAS and was declined. DFAS requirements for enrollment into Salary Offset were not met. This decision prevents the same account from being resubmitted for review in the future. Non-enrollment fee of $85 is assessed upon return to Citi.

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5. Best Practices/AOPC Controls

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Best Practices/AOPC Controls

Utilize Cardholder Statements & Payments Option– Easier access while traveling– Cardholders can access CS&P through self-

registration– Payments made online are free and post faster

than mailing– Can view current and prior statements– Can view unbilled transactions to get a “jump”

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 the card– Educate cardholders to file travel vouchers as

soon possible®

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Best Practices/AOPC Controls (continued)

Maximize Card Control– Immediately update separated cardholders– Ensure updated contact information on

cardholders within hierarchy– Audit for unnecessary MCC’s regularly – utilize the

Block MCC Report– Minimize credit limits (cash and purchase) as

appropriate

Utilize Citi Online Reporting Tools– Monitor spending and payment history for

accounts– Frequently monitor suspension/cancellation

reports– Empower AOPC’s at all levels to take action

against delinquent cardholders

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6. Delinquency Management Reports/Tools

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Delinquency Management Reports/Tools – Citibank Custom Reporting System (CCRS)

Delinquency Report

Pre-Suspension Report

Salary Offset Report

Non-travel-Related Activity Report

Account Activity Report

Declined Authorizations Report

Blocked MCC Report

CCRS provides access to detailed and easy-to-use reports to assist you with managing delinquencies within your hierarchy

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Once in CitiManager click on “Web Tools” then click Citibank Custom Reporting System hierarchy link and select the appropriate hierarchy link. This will prompt a new window to open.


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DoD TravelHow to Get to CCRS DOD Standard Reports

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Once the new CCRS window opens up click on Organizational Shared Folders


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DoD TravelHow to Get to the Delinquency Reports – Step by Step DoD Travel

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Click on the folder Department of Defense Travel Shared Reports

DoD TravelHow to Get to the Delinquency Reports – Step by Step

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Once the window refreshes you will see all of the staple reports prepared for Department of Defense

DoD TravelHow to Get to the Delinquency Reports – Step by Step

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Reports/Tools – Delinquency Report

The Delinquency Report provides account information at a specified hierarchy for any account holder considered past due on their card.


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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

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Reports/Tools – Pre-Suspension Report

The Pre-Suspension Report lists accounts that are between 45 – 60 days past billing from the billing cycle date within a specified hierarchy.


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HierarchyLevel 5 & 7

Account Status

SSN

Account Name

Pmt. Due Date

Past Due Amt

Days Past Due

Metrics

Last Statement Balance

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Reports/Tools – Salary Offset Report

The Salary Offset Detail Report lists accounts that have been enrolled in this program within a specified hierarchy and the cardholder’s current balance.


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The Salary Offset Summary lists total amount of cards and current total balance of cards within the hierarchy choice.

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Reports/Tools – 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.


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Account Number

Account Status

SSN

Account Name

Pmt. Past Due

Date Suspended

Last Statement

Bal.

Number of Times Suspended Past

YearMetrics

Past DueAmt.

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Reports/Tools – Non-Travel-Related Activity Report

The Non-Travel-Related Activity Report provides information to identify accountholders with transaction activity (such as cash, fuel, or food) occurring without other associated travel activity (such as airline, car rental or lodging).


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Account Number

Account Name

Current Balance

Transaction Date

Merch.City

Merchant Name Merch.State

MCC

Metrics

Total Trans Amount

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Reports/Tools – Account Activity Report

The Account Activity Report provides detailed information regarding transactions for each account within a specified hierarchy level.


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Account Name 1

Account Name 2

Account Type

Account Type

Transaction Date

TransPost Date

Merchant Name

Merch.City

MCC

Merch.State

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Reports/Tools – Declined Authorization Report

The Declined Authorizations Report lists all attempted transactions and detailed reasons for decline and type of purchase within a specified hierarchy.


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Account Name 1

DeclineDate

DeclineTime

Primary Dec. Reason

Decline Reason 1

DeclineReason 2

Merch. City

Account Number

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Reports/Tools – Blocked MCC Report

The Blocked MCC Report shows all attempted transactions against excluded or restricted Merchant Category Codes (MCC).


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Transaction Date

Transaction DB-CR Indicator

MCC

Merchant Name MCC

Description

Transaction Post Date

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7. Current DoD Travel Card Results

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Delinquency ManagementCurrent DoD Delinquency ResultsIndividually Billed Accounts

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Delinquency as a % of Total Spend $ = 2.40%

Delinquent $($ Delinquent as of June 2011)

Spend $(Oct ’10– June ’11)

$82.7M $ 3.44B

Delinquency is defined as accounts > 31 days past due or 61 days past billing

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Delinquency ManagementCurrent DoD Delinquency ResultsCentrally Billed Accounts

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Delinquency as a % of Total Spend $ = 1.68%

Delinquent $($ Delinquent as of June 2011)

Spend $(Oct ’10– June ’11)

$17.6M $ 1.043B

Delinquency is defined as accounts > 31 days past due or 61 days past billing

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Current Component RPP/Salary Offset Results

*Data thru: 07/29/11

Reduced Payment Program Salary Offset

# of Accounts $ # of Accounts $

Air Force 86 $113,577 Air Force 912 $1,200,677

Army 221 $253,166 Army 3,013 $3,477,388

Navy 86 $119,144 Navy 777 $883,060

Marines 12 $14,934 Marines 80 $135,315

Independents 17 $54,467 Independents 46 $140,820

TOTALS 422 $555,288 TOTALS 4,828 $5,837,260


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Credit Losses by Component Fiscal YTD 2011

Losses Fiscal Year to Date 2011

# of Accounts ($)

Air Force 304 $442,141

Army 610 $894,174

Navy 360 $506,754

Marines 48 $77,366

Independents 20 $24,723

TOTALS 1,342 $1,945,158


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Data from: Oct 2010 – July 2011

8. Summary

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• 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!

Summary – Remember…

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Summary – Contact Information

E-mail: [email protected]

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DepartmentContact Numbers

Hours of OperationToll-Free Collect

Agency/ AOPC Service (866) 670-6462 (757) 853-2467

Monday – Saturday7:00 AM to 9:00 PM EST

DoD Collections (866) 670-6461 (757) 853-5708

Monday – Friday8:00 AM – 9:00 PM EST

Cardholder Customer Service

(800) 200-7056 (757) 852-9076 24 hours a day; 7 days a week

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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

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Reminders DoD Travel


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Schedules Available at the Welcome Center DoD Travel

Course Title

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Interactive Training Events – DoD DoD Travel


Citi offers on-site training at no cost for agencies meeting the required minimum participant level of 20 or more as set forth in the GSA SmartPay2 Master Contract.

Regional Citi Training Locations– Norfolk, VA– Washington, DC– Visit www.defensetravel.dod.mil/passport to view and register for these sessions

Upcoming Training– Visit www.defensetravel.dod.mil/passport to view and register for these sessions

On-site at your base or installation– 20-participant minimum– Visit www.citimanager.com/dodhome and under Resources to download the On-site

Training Request Form

Distance Learning – Video Conferences

Please e-mail us at [email protected] and a Citi training coordinator will work with you directly for on-site or Distance Learning sessions.


Deanne Burbee

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Terms & Disclosures

Tuesday, July 28, 2009

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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.

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delinquency management - citibank · 15 delinquency management common causes of delinquency...

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