Automation and digitization offer new tools for your collection strategy, augmenting the traditional building blocks. These new tools, introducing flexibility and sophistication that are usually attributed to other parts of the business, can mitigate common pitfalls.
In this series, adapted from our free eBook Automating Debt Collection 101, we’ll review the three major areas where automation and digitization can boost a collection strategy:
- Early contacts and improved segmentation
- Persistent communication
- Improved customer satisfaction
In this second part, we’ll focus on improving performance with persistent communication.
Customers in debt are in a dire situation, cannot pay the balance in full, and many times even a payment plan isn’t feasible. A call center is limited in its flexibility – beyond a certain number of payments or customizations, a human agent is just too expensive. These accounts risk being mishandled, and end up paying less than they could with some “hand holding”.
Automated collections have a tremendous advantage in handling complex cases. The platform consistently follows up with customers using multiple channels, offering various solutions according to an optimized offer strategy, and administers changes in those solutions (split payments, rescheduling and more) over time as needs change. These tools can accept and administer a monthly $5 payment that increases over time, even if the customer misses a few payments and needs consistent follow-ups. When the vast majority of contacts are automated, even small amounts are profitable – and add up. The system doesn’t get tired, doesn’t get angry, and doesn’t need to go home by the end of the day. It’s there to service the customer.
TrueAccord sees more than 35% of customers in an average placement click on a link and negotiate with an automated system, thanks to diligent and relevant follow ups. In tests, working on the long tail of underserved accounts yields 4-8% of additional recovery – dollars that would otherwise be considered lost.
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