TMTPOST--In recent years, generative AI has permeated various industries, from small-scale applications like Siri on our phones to large-scale innovations like autonomous vehicles.

While many AI applications struggle with monetization, AI-powered debt collection in the financial sector is thriving. Notably, Ultra Power, a Shenzhen-listed gaming company, has ventured into AI-aided debt collection and achieved a remarkable success.

Ultra Power, founded in 2001 and listed on the ChiNext Market in Shenzhen in 2009, has traditionally focused on gaming and computer technology. According to the company's 2023 annual report, their AI-based debt collection solution "Power Collector" has delivered impressive results: an eight to ten fold increase in case efficiency, 100% compliance throughout the process, and a 50% boost in per capita commissions for agents.

Debt collection typically involves the creditor or a third-party agent recovering overdue payments. The industry has long been associated with negative connotations such as violence, harassment, and illegal activities. However, leveraging AI to conduct efficient and lawful debt collection has been a long-standing goal of the financial sector, now realized by an unexpected player in the gaming industry. 

Intelligent debt collection is significantly more efficient than manual methods. Robots can work around the clock without the constraints of time and energy, greatly enhancing the processing speed of collection tasks. With automated and standardized procedures, robots can handle large volumes of overdue accounts swiftly, quickly identifying and contacting debtors.

Besides, utilizing advanced technologies such as big data and artificial intelligence, robots can deeply analyze customer information to accurately assess risk levels and formulate personalized collection strategies. Through intelligent analysis of conversation content, robots can effectively gauge a debtor's willingness to repay and their financial situation, allowing for timely adjustments in their approach and increasing the success rate of collections.

Ultra Power has been mainly engaged in gaming business, which continues to drive its revenue growth. In 2023, the company reported a revenue of 5.962 billion yuan, up 24.06% year-on-year, and a net profit of 880 million yuan, up 65.5%. The gaming segment contributed 4.497 billion yuan, accounting for 75.43% of its total revenue.

Although gaming is the primary revenue source, the software development and IT services of Ultra Power also experienced double-digit growth. These services include ICT operations management, artificial intelligence, cloud services, information security, and IoT/innovative businesses. The intelligent debt collection service falls under their AI business category.

Gaming companies often invest heavily in AI research and development. A report by Gamma Data on the development of new quality productive forces of China's gaming industry noted that nearly 80% of leading gaming enterprises are involved in AI, digital twins, engine development, cloud technology, and XR.

Around 60% have established AI production pipelines to enhance virtual content production and intelligent marketing. Furthermore, the top 50 Chinese gaming firms have made over 100 investments in AI companies.

Ultra Power's advancements in AI technology enabled them to excel in AI-powered debt collection. Since 2019, the company has optimized its business structure, focusing on ICT, IoT/communications, and AI. In 2022, they launched the "Power Collector" platform, integrating traditional debt collection methods with AI to enhance efficiency.

This platform uses AI for front-end operations and human-machine collaboration, addressing cost and efficiency issues in debt collection and potentially driving rapid growth. Additionally, Ultra Power has expanded into intelligent telemarketing.

As banks face rising loan default rates, the demand for effective debt collection grows. Successful debt collection reduces non-performing loan balances and can recover written-off loans, bolstering banks' risk buffers and enhancing profitability. In the current low-interest environment, improving asset quality and net profit is crucial for banks.

According to a report by Kaiyuan Securities, the intelligent debt collection and telemarketing services of the company are expected to continue expanding, thus increasing the penetration of AI-driven business and boosting related revenue.

While AI-driven debt collection proves effective, it cannot entirely replace human efforts. Challenges like understanding complex conversations, interpreting customer intentions, and maintaining high-quality interactions remain. Effective AI debt collection requires well-developed AI products and strong operational support to achieve optimal results.