Prodigal AI: The Future of Debt Collection and Loan Servicing with Generative Intelligence

This article explores how Prodigal AI, an AI-driven debt-collection and loan-servicing platform, is transforming the way lenders interact with borrowers using advanced artificial intelligence. It covers what Prodigal does, why the traditional collections industry needs innovation, how the technology works, funding and growth, and the implications for lenders, borrowers, and the broader financial ecosystem.

Why Debt Collection Needs Innovation

Debt collection and loan servicing are essential functions of the financial ecosystem. Traditionally, banks, non-bank financial companies (NBFCs), and debt purchasers employ large teams to make calls, send emails and SMS, and manually follow up with borrowers who have missed payments. 

This approach is costly, slow, and can result in customer frustration due to impersonal or repetitive interactions. Moreover, scaling such operations globally across multiple languages and channels adds another layer of complexity for financial institutions.

Enter Prodigal AI — a startup that applies generative artificial intelligence to automate and personalize these burdensome tasks. Launched by founders with deep experience in financial services and AI, Prodigal’s platform is designed to replace repetitive, manual workloads with intelligent, context-aware agents that can communicate naturally with borrowers and assist human agents where needed.

As consumer debt continues to grow — spanning credit cards, personal loans, auto loans, buy-now-pay-later (BNPL) accounts, and healthcare financing — demand for efficient, scalable collections solutions has surged. The market for debt servicing technology is expected to expand rapidly over the coming decade, opening a significant opportunity for AI-native platforms.

What Is Prodigal AI and How It Works

Prodigal AI is a purpose-built agentic platform for loan servicing and debt collections, powered by a proprietary intelligence engine that unifies diverse customer data sources into a single context and uses AI to automate conversation and decision-making.

Rather than relying on scripted messages or manual follow-ups, Prodigal’s AI agents — such as proAgent, interact with borrowers across voice, SMS, and email 24/7, interpreting behavioural signals to personalise communication and drive better payment outcomes. 

The system can autonomously handle routine tasks like payment reminders, follow-ups, and negotiation within the lender’s policies, while seamlessly escalating complex scenarios to human agents.

Prodigal’s architecture combines large language models (LLMs) like GPT-4 and Claude Sonnet 3.5 with fine-tuned, task-specific models for efficient rote tasks and a higher-order layer that reasons dynamically based on conversation context. 

The solution is deeply integrated with operational data, including CRM systems, dialers, borrower history, and engagement patterns, enabling tailored, compliant interactions that respect regulatory constraints.

One of Prodigal’s differentiators is real-time negotiation capability: unlike fixed scripts, the AI can calculate personalised payment options in real time based on borrower financial data, affordability models, and policy boundaries set by the lender. This helps align recovery strategies more closely with individual situations.

The Collections & Loan Servicing Market Today

Before diving further into Prodigal, it’s useful to understand the scale and trends in the broader collections technology market.

Table 1: Global Debt Collection Market: Size & Growth

Below is a snapshot of the debt collections market, a segment ripe for AI innovation, showing both current size and projected growth:
 

Source: Precedence Research via YourStory reporting

Summary of Table / Impact:
The debt collection and loan servicing market is growing steadily, with nearly doubling in scale expected over the next decade. This reflects rising levels of consumer credit and the need for scalable solutions that improve both lender efficiency and customer experience. This growth underpins the demand for platforms like Prodigal that combine automation with deep personalization.

Funding and Growth: How Prodigal Is Scaling

Prodigal has raised $14 million in total equity funding to date. Early capital included a seed round of roughly $2 million backed by Y Combinator and Accel, and a $12 million Series A led by Accel and Menlo Ventures.

These funds are being used to expand Prodigal’s engineering and product teams, scale AI capabilities, and refine features, particularly in voice and real-time dialogue nuance for customer interactions. Investors are bullish about Prodigal’s potential to redefine the backend of lending operations globally.

Prodigal’s leadership includes founders with extensive industry experience: Shantanu Gangal, with a background at Fundbox and Blackstone, and Sangram Raje, formerly a US equities desk lead at Tower Research. Their combined expertise in finance and technology has helped shape a platform that understands both regulatory complexity and operational pain points.

Beyond funding, Prodigal already counts 100+ financial institutions as customers, spanning BNPL companies, lenders, auto finance operations, and major debt buyers, reflecting traction across multiple asset classes. This broad client base shows that AI-driven servicing is relevant across different types of borrower portfolios.

Prodigal’s Product Suite and Key Features

Prodigal’s platform is more than a single chatbot; it’s a comprehensive AI-native collections and servicing ecosystem. Key components include:

• proAgent: AI agent for autonomous engagement in voice, SMS, and email. 
• ProPay: Self-service payment portal enabling digital payments and reminders.
• ProInsight & ScoreGenie: Data analytics modules for interaction scoring and behaviour prediction.
• ProNotes & ProAssist: Tools for automated documentation and live agent coaching.

The unified intelligence engine ensures consistent context across interactions, enabling personalised care while staying fully compliant with relevant financial regulations — a key concern in collections where both customer experience and legal adherence matter.

Why AI Is Poised to Revolutionise Debt Resolution

AI-powered platforms like Prodigal are not isolated innovations; they reflect a broader shift in how financial institutions manage loan servicing and debt recovery:

• Automated workflows substantially reduce manual labour and operational cost.
• Personalised engagement improves payment outcomes by addressing borrower circumstances more empathetically.
• Scalability: AI scales effortlessly across geographies, languages, and channels (voice, text, email).
• Compliance & Analytics: AI models can enforce regulatory rules consistently and provide insight into patterns across millions of interactions.

According to industry research, adoption of AI/ML tools in debt collections rose from roughly 11% in 2023 to 18% in 2024, and 73% of companies plan increased investment in AI by 2025, indicating a rapid technology shift.

Implications for Lenders, Borrowers, and the Industry

For lenders and NBFCs, AI-driven servicing platforms offer reduced costs and improved recovery rates without expanding large call centres. Early adopters report higher engagement, better agent effectiveness, and more efficient compliance reviews, sometimes lowering labour costs and increasing positive contact with borrowers.

For borrowers, the promise is more context-sensitive, less adversarial communication. Prospective repayment plans can adapt to individual affordability, reducing stress and potentially lowering the stigma of debt.

On the industry level, widespread AI adoption may recalibrate how debt is managed, moving from hard-coded scripts to dynamic, humane conversations. It also raises questions about data privacy, AI ethics, and transparency in automated decision-making — topics regulators are increasingly scrutinising.

Conclusion

Prodigal AI exemplifies how generative artificial intelligence can transform legacy financial processes. By automating and personalising debt collection and loan servicing, it helps lenders improve outcomes, simplifies borrower engagement, and addresses scale and efficiency challenges in a growing debt market. 

With strong funding, a global customer base, and a suite of specialised tools, the startup is well-positioned in a segment ripe for disruption. As AI continues to mature in financial workflows, platforms like Prodigal could become central to how credit is managed and recovered, marking a meaningful evolution in consumer finance.
 

Apply for Loans Fast and Hassle-Free

Apply Now

About the Author

LoansJagat Team

‘Simplify Finance for Everyone.’ This is the common goal of our team, as we try to explain any topic with relatable examples. From personal to business finance, managing EMIs to becoming debt-free, we do extensive research on each and every parameter, so you don’t have to. Scroll up and have a look at what 15+ years of experience in the BFSI sector looks like.