Each of the individual challenges faced by credit collections teams are big in their own right. Combined, there’s a lot to overcome. Some of these include ensuring revenue targets are hit, making contact with the right person, keeping customer relationships on a good footing, and acting within government regulations. Often, the fear and inconvenience of talking to a traditional customer service rep — who may call two or three times a day — is enough to keep the customer from picking up the phone, delaying payment, and having knock-on effects across the business. But debt and credit collection software is changing that dynamic, making the process more comfortable for customers, providing valuable data on customer behaviors, and often helping to prevent customers’ accounts from going to collections in the first place. This technology helps companies improve customers’ promises to pay.
The Current State of Debt in the UK
In the UK, consumer debt continues to rise, recently reaching over £1.5 trillion. That’s a large group of consumers who struggle with either the repayment plans or the payment-submittal process.
That’s also a lot of outbound calls collectors must place to follow up on debt. However, inundating customers with calls is a sure fire way to damage customer relations. According to Ofcom, the UK’s communications regulator, credit collection calls made up the majority of outbound calls (pdf) received by consumers in 2015. This may be part of the reason for Ofcom’s upcoming updates on the rules governing how companies can contact people for credit collection. This comes into effect October 2018.
Clearly, most people don’t want to end up in collections, but they may not know the best way to repay the money they owe. However, it can be difficult and time consuming for brands to make right-party-contact.
Because of this, companies face the questions of how to get ahold of debt-owing customers, how to set up payment plans, and how to maintain a positive client relationship, whenever possible.
Credit collection software — such as immediate payment portals, interactive voice response (IVR), SMS text messaging reminders, outbound chat bots, and two-way SMS support — provides solutions to these roadblocks for customers and businesses alike.
How Credit Collection Software Increases ‘Promises to Pay’
With the aid of technology, companies can overcome the hurdles that keep customers from taking action on their debt, while also gathering valuable insights into how their customers ultimately end of fulfilling their promise to pay so they don’t end up getting calls from collectors.
Breaks Down Communications Barriers
While your company may do its business predominantly in one country or region, that doesn’t mean the communication level, the language, or the ability of each customer is the same.
For some, the already-intimidating process of paying back money is made worse by not having proficient skills in the language of the company calling you.
Debt-recovery technology — and debt-recovery strategies that fully embrace technology — allow customers to select their preferred communication, which makes them more receptive to communicating with the company they owe money to.
Allowing customers to communicate with your debt-recovery team the way they’re most comfortable also opens up the opportunity for those who prefer SMS text messaging or people with speaking or hearing disabilities to meet you where they’re most comfortable.
By embracing different methods of communication through technology, companies also save the time — and therefore the payroll cost — of having staff follow up multiple times with the same customer, to no avail.
Makes Repayment More Practical for Customers
Debt-recovery strategies that use technology also allow companies to offer custom payment plans to customers, giving them more flexibility in their repayment and resulting in a better follow-through on a promise to pay.
By providing people with an automated, easy-to-understand plan, they’re less likely to become delinquent on their payments and require collection on their debt.
Integrated messaging across multiple channels makes communications with customers easier and maintains goodwill between the customer and the company, which is often not the case when agents have to traditionally follow up on debt.
Options such as one-touch payment reduce the chance for discontinuity or delayed payment and require fewer steps for customers looking to pay their debt.
Using technology like this can result in a 200% increase in customer contact with a reduction in remote procedure call (RPC) costs, a 2% increase in 90-day plus “promises to pay” delivered with 65% fewer agents and an increased conversion of promised payments to actual payments for late-stage debts.
Customers can make payments quickly and easily without having to interact with customer service or the bank directly, fitting into customers’ demand for digital immediacy.
Creates More Data to Understand Customer Repayment Trends
Beyond helping to maintain client relationships and recover debt when needed, embracing technology in your debt-recovery strategy provides the chance to collect valuable information and data on your customers.
The utilization of debt-recovery technology allows companies to collect data on when and how their customers like to be contacted on a case-by-case basis which can inform communications in the future beyond promise to pay. This data helps companies create incentive programs — such as fee waivers — to help encourage customers to pay promptly, too.
Companies can also get an idea of which departments customers most often need to talk to and what they’re questions are by using IVR assistance as part of their debt-recovery strategy.
And when things haven’t been going well with a particular customer, or companies want to have a better idea of who may need more prompting to pay in the future, predictive analytics from debt-recovery technology can help identify risky customers. This allows companies to avoid such customers or to know what processes and methods best work to handle setting up their promises to pay.
If necessary, this debt-recovery technology can also alert companies to the need to switch from a strategy built to protect the customer relationship to one that prioritizes protecting assets using analytics and automation.
How VoiceSage Software Helps Credit Collections
Using VoiceSage’s suite of valuable SMS marketing and outbound customer-communication services, you can weave your SMS marketing strategy into your broader marketing and customer-communications plan. With our cloud-based messaging products and services — which deliver more than 2 million messages per day — we provide transformational interactive customer-communications solutions for high-volume contact activities.
Here are just some of the technologies used to help enable credit collection goals.
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