Tips for hiring a debt collection agency for your small business

By on January 16th, 2020 in Industry Insights

In any industry where money is exchanged, debt is an inevitability. For small businesses, even small transactions can add up quickly and late payments, delinquent accounts, and chargebacks can start to bury an otherwise thriving business. This is where a debt collection agency can help your business succeed. 

Recovering payments on otherwise lost accounts probably sounds great, but let’s do some research before you get started! Here are a few things to consider when you begin looking for a collection agency for your small business.

1. Where can they collect?

Collections agencies can provide financial services to businesses ranging from those in their local area to companies across the country, but it’s important to validate that they can operate in your state! Local collectors may not have the licensing authority to collect across state lines. 

Larger collection agencies may also work across the country and even specialize in collecting certain types of debt for a given industry, such as point of sale transactions, credit card, rent to own products, loans, etc.

2. What industries do they serve?

The needs of B2C (business-to-consumer) businesses are dramatically different than those of primarily B2B (business-to-business) business lenders or tech start-ups. Collectors that specialize in specific verticals can ramp up and start collecting effectively, faster because of their familiarity with consumers in that space. Don’t be afraid to ask a collector for their experience working with other businesses like yours!

3. Are they legally compliant?

Beyond the local and state level access, federal regulations play a large part in a collector’s operational ability. Keep your business safe and verify that the company you’re interested in working with has a comprehensive compliance management system.

A proper system will be designed to be in compliance with the Fair Debt Collection Practices Act as well as other state and federal regulations.  Also, ask what preparations the company has made for compliance with the upcoming Consumer Financial Protection Bureau’s newly proposed rules.

When you begin your research into new agencies, consider visiting their Better Business Bureau page or looking through their Google Reviews. Consumers that have had particularly negative or even legally questionable experiences with the business may help you to recognize red flags before they become an issue for you and your team.

4. What is their pricing structure?

The price on any purchase for your business can make or break the decision to invest in a new product or service, and finding a debt collection agency at the right cost is no different. Most debt collection agencies will be priced in one of three ways: flat fee, contingency, or a hybrid model. 

  • A flat fee is a one-time service payment that coincides with signing a contract and will vary depending on the volume of accounts that are being collected on.
  • A contingency payment plan is a performance-based payment model where the collector only profits from the accounts they are able to collect on. Signing a contingency contract will typically outline the percentage that they will collect per account and may change from portfolio to portfolio. 
  • A hybrid model is often a custom solution that begins with a flat fee contract and expands out to accomodate more accounts if the collector is exceeding expectations. 

5. What communication channels are they using?

The debt collection industry is undergoing a massive change, and many collections agencies are struggling to adapt. Call-based collections has been the norm for decades, and a large percentage of debt collection agencies still rely on sending letters (91%) or making phone calls (89%) as their preferred contact channels. 

Unfortunately, these channels are no longer the ideal channels for consumers. Collection agencies that embrace digital channels (email, SMS messaging, etc.) are more likely to reach consumers when and where they like to communicate, and help to humanize the collections experience.

If you’re interested in learning more about the future of communication strategies in collections, you can read here!

Working with a debt collection agency may seem like a risk, but finding the right solution for your business can mean recovering revenue that would have otherwise been entirely lost. Just make sure that your new partner is the right one for your business. What other questions do you have about what it means to work with a collection agency? Let us know!

A new decade for debt collection

By on January 8th, 2020 in Industry Insights

A new year often marks the time for resolutions and major change. Goals are set. Budgets are ready to go. Product roadmaps start to unfold. For us, change and growth don’t just start and stop in January. TrueAccord is working to be better every day, and this year is no different.

We know that the collections industry is changing quickly, and we’re ready to ride the wave. Check out what TrueAccord’s leadership has to say about the future of collections and what we expect to see in 2020 and beyond!

Ohad Samet, CEO

We’ve seen a recent growth of digital debt collections strategies for to the benefit of both collectors and consumers. As the industry jumps forward, what do you see as the biggest challenge facing teams in the collections space?

The collection industry has been fighting a losing battle against the demise of phone calls as a valid contact channel. Rule changes and consumer behavior are rendering phone calls obsolete, and we’ve started to see the result in consolidation and closures. This trend will accelerate in 2020, and the realization will come, whether in 2020 or subsequent years, that companies will need to adapt.

And what makes this change such a significant challenge to existing collectors? Could a traditional call-based agency simply start sending emails to consumers in debt?

This shift isn’t only a conceptual one; it has deep technological and operational implications. Operating digital channels at scale is a new challenge, completely different than calling using a dialer, and traditional providers will find it increasingly difficult to catch up at scale. 

Emails and text messages aren’t simply cheaper alternatives to letters—they are two-sided, complex media that require data and inference infrastructure that’s difficult to build and maintain, especially with thin margins. Clients will need to re-evaluate how they work with a narrowing landscape of skilled, at-scale providers who can handle this new world.

Sheila Monroe, COO

As Ohad mentioned, the collections industry has largely remained unchanged for years and relied heavily on call-based collecting as its primary contact channel, what will make the 2020s different?

Technology is advancing exponentially. When combined with the lightning speed of adapting consumer expectations and a regulatory landscape driven largely by consumer advocacy, leaders in this industry will anticipate and create the way forward. Those playing catch up, or missing the cues, will inevitably struggle to survive. 

Those that lead the charge in the 2020s will drive a focus on machine learning, AI, advanced analytics, and automation as the entire industry finds itself at a tipping point in this new decade.  

New technologies are often developed to address a specific problem. What is the main issue you feel these new technologies are working to solve? 

The digital revolution has already started. Much of the technology exists, and many creditors and collectors are experimenting with digital channels such as SMS and email. That said, being able to close the gap between consumer expectations and creditor or collector offerings represents a high hurdle for many in this space that more complex machine learning and AI can help to address.

Kelly Knepper-Stephens, VP of Legal & Compliance

Rapidly advancing technology is complex in and of itself, but collections is also a carefully regulated industry. The last major update to collections law was in 1977, long before most of today’s technology was even a possibility.

We’ve spoken before about how the CFPB’s NPRM has set out to make major changes to existing laws in order to incorporate new technologies into collections regulation. How will those updates shape the industry going forward into 2020?

The NPRM, which should have a final rule sometime this year, makes clear that “modern” forms of communication (email, text, and others) are methods by which agencies can use to communicate with consumers. Those agencies who haven’t invested in these technologies yet are all starting to broaden their communication tools now in order to prepare.

As we move into the new decade, innovative agencies will continue to build out ways to reach consumers based on their preferences, using tools we don’t even know about today. We might even see the reputation of the industry shift as these friendlier collection methods allow consumers the freedom to choose how best to communicate and resolve their debt.

Looking ahead

Consumer communication preferences are evolving, new channels are becoming available to collectors, and merging these shifts together will be the key to successful collections through the 2020s.

How to Build Your Business’ Reputation Using Digital Collections

By on November 6th, 2019 in Industry Insights
five people putting their hands in for a deal

The age of the internet has brought about an age of transparency and exposure. News can travel around the globe in seconds thanks to the power of social media, and this visibility means that a company’s business practices, day to day operations, and mission are just as clear and present in the market as their products and services. Brand matters, and nothing helps to build or break a brand’s reputation faster than social proof

Today, companies don’t win just because they have the best products and services, they win when they provide the best customer experience and allow their customers to share that with the world. Companies that do this well are experience disruptors. Creditors looking for collections solutions can struggle to provide a positive collections experience (no customer wants to be in debt after all), but we know that it’s possible to build your brand and still collect on debts at the same time.

Stay ahead of compliance

This should go without saying, but collections teams that stay up-to-date and even ahead of federal and state compliance meet with fewer customer complaints and lawsuits. In an industry where not using (or even over-using) the right language can lead to a lawsuit, ensuring compliance must be the first step in providing a consistent, secure, and positive brand experience. 

Creditors and customers alike benefit from collections systems that keep compliance at the forefront. New regulations like the CFPB’s proposed rules can add new layers of complexity to the collections process. Thankfully, digital collections strategies can aid in coding compliance directly into outreach and minimizing human error!

Be transparent

Speaking of using the right language at the right time, using clearcut language that helps consumers understand their debt is essential to building a brand that is seen as reliable and trustworthy.

Building your brand with a modern, digital collections strategy is essential because today it isn’t just about reaching consumers and requesting payment.

While compliant language is a large part of transparency, making it easy for customers to understand the exact steps they have to take to get out of debt and how they can work with a team to pay off that debt helps smooth the process. When steps to get back on track are clearly outlined and presented in a way that is digestible to the least sophisticated consumer, the debt payment experience is better for everyone.

Adapt to changing customer expectations

Customers expect their financial services to be exactly that—services; they want their tools to work for them. If someone can do all of their day-to-day banking through an app, they shouldn’t have to wade through stacks of paper mail and phone calls in order to resolve a debt.

Traditional collections models have made some technological advancements, but are still largely bound to call-based collections practices. Financial technology experience disruptors like Rocket Mortgage have simplified and digitized their services to meet consumer expectations. NerdWallet says that their “document and asset retrieval capabilities alone can save you a bunch of time and hassle.”

Make a change

Digital debt collection agencies are dedicated to saving consumers time and hassle by reaching them via email and push notifications instead of calling in the middle of dinner. Customers can respond to outreach and utilize payment systems at their own pace. 

Building your brand with a modern, digital collections strategy is essential because today it isn’t just about reaching consumers and requesting payment. Companies build reputation by providing a proper experience. How they collect is why they win. 

TrueAccord is redefining the collections experience for creditors and customers alike. Click here if you’re interested in learning more!

What are accounts uncollectible?

By on October 3rd, 2019 in Industry Insights
Hands holding hundred dollar bills

Debt collection agencies work to recover money on behalf of creditors. Unfortunately, not every debt is collectible, and it’s important to recognize these edge cases before they become bigger problems.

What are accounts uncollectible?

Accounts uncollectible, also known as uncollectible debts, are accounts owed that have almost no chance of being paid off. While it is better for the customer’s credit score and overall financial health, as well as for the lending company’s growth to receive these payments, there are some debts that will simply never be paid. There are several reasons that this may be the case:

  • A customer is not reachable
  • A customer is unable to pay
  • A customer declares bankruptcy
  • A customer disputes the debt

While some debts may reach a point where they become uncollectible, there is a lot that can be done before those delinquent accounts reach the point of no return. Debt collection agencies serve to lessen the impact of accounts that become uncollectible and work to prevent them from becoming bad debts

The longer a company waits to adopt a collections solution, the more accounts they risk becoming uncollectible. We’ve already looked at some reasons why a debt may be hard to collect, but if a customer owes a debt, they have to pay it, right? Unfortunately, companies that make this assumption end up with debts on a timer.

A debt may reach its statute of limitations for collection.

Each state has distinct requirements that affect how long companies and collection agencies can legally collect on a debt. While a select few states have statutes that extend the collection window to up to 15 years, most are limited to somewhere between 3 and 6 years.

Once a debt ages out of these windows, it is considered a “time-barred debt.” Collecting a time-barred debt is possible, but the approaches are limited and creditors can no longer sue to demand collection.

Even if the debt is new enough to be collected, TrueAccord’s customer data indicates that new accounts (those in collections for fewer than 90 days) are four times more likely to begin a payment plan than those who’ve been in collections for more than six months. 

Those same new accounts are also eight times more likely to begin paying off a debt than those who have been in debt for longer than two years. This rapid decline means that creditors need to act quickly to prevent an account from slipping away.

How do you avoid accounts uncollectible?

If a customer has not paid a debt for one reason or another then companies are working against the clock to collect. The typical solution to recouping otherwise uncollectible debts is to hire a third-party debt collection agency. Many agencies operate by reaching out to customers and requesting (or demanding) payment for a debt, hoping to instill a sense of urgency in the customer.

One of the issues with this approach is that customers are forced to engage on the collector’s time rather than on their own. TrueAccord recognizes that when customers work on their own time, they are given power over their financial freedom and are more likely to commit to a payment plan. 

Another key issue with the traditional collections model is a lack of proper analytics. While call centers may reach hundreds of customers daily, each call can vary wildly due to the personal nature of a phone call. Digital-first collections strategies allow agencies to regularly send consistent messages and accurately test which of those messages prompt the most engagement and, ultimately, lead to payments. 

Any amount of uncollectible debt directly translates to a loss for creditors. The best option available to companies that wish to avoid losing out on delinquent accounts entirely is to embrace a digital-driven debt collection strategy. Uncollectible accounts will only get more difficult to recover over time, and if teams wait too long those accounts will truly be untouchable. 

What do debt collection agencies do?

By on September 25th, 2019 in Industry Insights
Coins spilling out of jar

Whether you’re trying to collect on small accounts or massive debts, working with an agency can help to improve your business’ bottom line. There are different approaches to the collections process and understanding those differences, the role of agencies, and the industry as a whole can help you make the right decision for your business.

What is a debt collection agency?

A debt collection agency, or debt collector, is a company, team, or individual that works to recover money on delinquent accounts. While some large companies opt to dedicate internal teams to the collections process, smaller and mid-sized companies opt to work with 3rd party debt collection agencies.

How do debt collection agencies work?

Collections agencies function as a financial service for companies that seek to outsource their collection needs and provide consumers a point of contact for paying off their debts. Agencies can work with a variety of companies and collect one or several types of debt, including:

  • Credit card debt
  • Medical debt
  • Car loan debt
  • Home loan debt
  • Personal loan debt
  • Business debt
  • Student loan debt

Delinquent balances that would otherwise sit unpaid are compiled into a portfolio for the debt collection agency to manage. These debts are still owned by the crediting company, and the collection agency functions as a liaison between the creditor and consumer. This relationship does not come without a cost. 

Debt collection agencies are paid based on a percentage of the debts that they are able to collect. This traditional collections model often extends to individual collectors whose earnings are paid out on a commission structure. Traditional debt collection agencies and their agents, therefore, are incentivized to reach customers however they can.

It’s important to recognize when a debt (or portfolio of debts) may no longer be collectible and what you can do to engage customers before their accounts reach that point.

Debt often can be tied to feelings of anxiety, stress, and depression, and when these feelings are met with persistent contact, rather than understanding, they can worsen. It is for this reason that the Consumer Financial Protection Bureau is working to make changes to existing debt collection laws and better protect consumers from predatory practices.

Debt Buyers

While typical agencies work with creditors that own the debt, debt buyers will outright purchase hard-to-collect debts. A debt may be considered hard to collect if it is nearing its statute of limitations for collection, a particularly small debt, or if other agencies have been otherwise unsuccessful in collecting it. Accounts with similar features (amount owed, age of the debt, amount of communication) will be grouped together, sold, and managed as a single portfolio.

If, for example, thirty customers owed Creditor A $100, but their debts went unpaid and ignored for a long period of time, Creditor A may no longer feel it is worth the time or resources required to pursue them. A debt buyer would purchase these debts from the creditor, and assisting the creditor in recouping the loss and reinvest that capital. Creditor A would recover a small portion of money they were not able to recover, and the debt buyer would then be able to freely pursue the debts for their own profit.

It’s important to recognize when a debt (or portfolio of debts) may no longer be collectible and what you can do to engage customers before their accounts reach that point. Using customers’ preferred communication channels and engaging with customers empathetically can help them recognize collections for what it is: a financial service.

The future of debt collection agencies

Expanding laws and developing technologies are gradually reshaping the collections industry. While the market itself may not change substantially (there will always be creditors, customers, and collectors), the ways in which collection agencies conduct their business will change drastically. 

Updates to the Consumer Financial Protection Bureau’s regulations, along with evolving digital debt collection tools are driving a new era of collections practices. TrueAccord is dedicated to seeing these changes made real with our customer-focused, digital first collections strategy. Selecting the proper strategy for your business can make an enormous impact, but a proper collections strategy takes time to build, so get planning!

TrueAccord Submits Debt Collection NPRM Comments

By on September 19th, 2019 in Company News, Industry Insights
man_signing_document

In an effort to further improve the debt collection experience for consumers, TrueAccord filed comments in response to the Consumer Financial Protection Bureau’s (CFPB) Notice of Proposed Debt Collection Rulemaking. Our experience using mostly email to communicate with consumers about their debts gives us the unique ability to provide detailed feedback to the CFPB on the parts of the Proposed Rule that impacts the use of email, data science, and machine learning in debt collection. 

We know that consumers in debt collection benefit from both email communications and machine learning technologies. Email communications allow consumers to access content at their convenience (including emails that contain legally required disclosures); new machine learning technologies provide additional information and payment options based on the consumer’s interactions to further personalize their collections experience.

What are we suggesting?

Make the transition into collections communication simpler

When emailing a consumer, either an initial communication—one containing the validation notice in the body—or any communication relating to the debt, a debt collector should be able to contact that consumer at the email address that the consumer provided to the creditor. 

The proposed rules do not currently provide this option without causing an undue burden on consumers. TrueAccord highlighted that unnecessary restrictions in the proposal greatly limit the ability to communicate with consumers via email. Consumers who have already provided their preference for electronic communications to their creditor(s) would be forced to take extra steps because they have fallen into collection. 

Define and properly evaluate email as a unique medium

Our customers regularly tell us that email is very different from phone calls and even paper mail. As such, email communications warrant different treatment under the FDCPA and should not be subject to the standard time, place, and manner restrictions that were designed for and apply to primarily oral communications.

TrueAccord asked the Bureau to take this opportunity to further modernize the FDCPA by distinguishing that certain provisions do not apply to email. 

Recognize other, optional forms of electronic communications as legitimate

We raise concerns over the proposed definition of “attempted communication” and “limited content message.” The current proposed definitions have the unintended consequence of limiting digital advertising and other electronic messages that consumers can opt-in to receive. 

What is our goal?

TrueAccord’s suggested changes will increase the proposed rule’s ability to make collections more efficient, provide actual notice to consumers, give consumers immediate access to information, and enable consumers to control how they want to communicate.

The debt collection proposed rulemaking is an opportunity to empower the vast majority of consumers who prefer to communicate electronically. The Bureau must take advantage of this opportunity.

You can read TrueAccord’s full comments here.

Lavallee v. Med-1 Solutions Confirms Common Sense Email Principles

By on August 26th, 2019 in Compliance, Industry Insights

On August 8, 2019, the Seventh Circuit Court of Appeals (7th Cir.) released its long-awaited verdict in the case of Lavallee v. Med-1 Solutions, LLC, 17-3244 (7th Cir. Aug. 8, 2019). The court ruled that Med-1 Solutions, LLC did not properly provide the validation notice as required by the Fair Debt Collection Practices Act.

Additionally, the court held that the first email Med-1 Solutions, LLC sent did not constitute a debt collection communication. Despite the unsuccessful method by which Med-1 attempted to email the initial communication, it is possible to do so in a compliant manner consistent with the current interpretation of the FDCPA.

The court’s decision

The Court held that Med-1 Solutions, LLC did not properly deliver the validation notice to the consumer. Med-1 sent the Plaintiff an email, but the email did not contain the text of the validation notice.

Instead, the email contained a hyperlink to a page where the Plaintiff would have had to enter personal information, and then take four additional steps in order to open a PDF containing the full initial demand letter with the required validation notice language. 

The Court reasoned that Med-1’s email did not constitute a communication because the email did not have any content relating to a debt. The Seventh Circuit reasoned that the “email conveyed three pieces of information:

  • The sender’s name (Med-1 Solutions, LLC)
  • Its email address
  • The fact that it ‘has sent … a secure message.’ ”

The email did not convey any information about the debt so it did not constitute a communication.

The FDCPA requires debt collectors to provide the validation notice in the initial communication or within 5 days of the initial communication in writing. Since the email did not constitute an initial communication, the Court found the initial communication happened over the phone. Med-1 Solutions, LLC, however, did not provide the validation notice during that call or in writing within 5 days because the company believed that their email satisfied the requirement. 

How to provide a validation notice in initial communication via email

When sending an initial communication by email, the content in the body of that email must contain all the validation notice requirements (15 USC § 1692g). It should:

  • Identify current creditor
  • State the amount owed
  • Provide the validation statement explaining the customer’s dispute rights

With the right information provided in the initial communication customer’s are more likely to recognize the account and trust that the email is from a legitimate debt collector. It should contain information on:

  • How to unsubscribe from future emails
  • Telephone contact information
  • The business’ hours of operation

Beyond that, it should comply with any other state, federal, or local obligations such as whether or not to provide a disclosure or other information. These are some of the principals embraced in the CFPB’s proposed debt collection rule. Had Med-1’s email contained this information in the body of the email, the result in the case would have been different.

Limited content emails 

The Seventh Circuit’s decision also highlights a concern with sending limited content communications via email. This case reinforces the importance of developing an email strategy and fully understanding deliverability requirements. This can ensure emails are delivered and not identified as spam and filtered away from a recipient’s view.

A full deliverability strategy may consider several factors including, but not limited to ISP reputation, providing relevant content in the body of the email, and more technical aspects of email such as throttling, bounces, and bulking. These elements can greatly affect an email’s ability to reach its intended recipient and ultimately convey its message.

Med-1 Solutions, LLC did not have a prior relationship with the Plaintiff, they did not remember receiving the email, and they did not click on the hyperlink provided in the email. As the lower court noted in its decision, the Department of Homeland Security warns consumers from clicking on links received in emails from unknown senders. The Seventh Circuit decision showcases the ineffectiveness of using a limited content message to reach and engage a consumer.

TrueAccord and the future of digital debt collection

We work to create a digital environment that places customer experience at the forefront of our collections strategy. This means ensuring not only personalized content delivered through our machine learning technology, flexible payment options, and digital access for customers to manage their debts. We do all of this via software that guarantees compliance.

If you want to learn more about how our technology can change your strategy, reach out to our team here!

TrueAccord and the Future of Digital Debt Collection

By on August 6th, 2019 in Industry Insights, Product and Technology

In January 2019, AccountsRecovery.net launched a survey of more than 100 companies in the credit and collections industry to “assess the penetration of digital communication tools and how much they are being used in the industry.” “Digital communication” includes channels such as email, text messaging, and web portals that work to reach to consumers. 

However, these channels are secondary to outbound calls and paper mail, practices that have remained unchanged for decades, even though 70% of companies believe that digital communications have had a moderate to significant impact on their collection rates! Updating these channels for the modern age can improve the collections experience for both the customer and collector. Let’s find out how!

Communication Channels

Email

According to the AccountsRecovery survey, more than half of the companies that took part in the survey are using email communication. A majority of respondents also said that they are sending emails to or receiving emails from fewer than 20% of their users. This means that 80% or more of their customers are regularly receiving calls from collectors to discuss resolving their debts rather than receiving digital communications. 

According to TrueAccord’s 2018 consumer survey, the majority of consumers using our site would rather resolve their debts online than through other channels. With such a large number of consumers interested in online engagement, it’s easy to see why we’ve leveraged digital channels to modernize the collections industry.

We use email communication as our primary form of contact at every stage of the customer lifecycle, and each message is customized for the individual.

Mobile and Text Messages

The prevalence of smartphones has made reaching out to users on their mobile devices an effective and essential channel for communicating with customers. Unfortunately, only 21.6% of collection companies are actively using text messaging as part of their outreach strategy! Even some of the largest agencies in the industry are only texting about ¼ of their customers. 

More than 65% of companies in the collections space that are not currently using text messaging as a channel are concerned about two things: a fear of being sued or not fully understanding what is and is not allowed of them. 

TrueAccord has taken steps to directly address these issues by hard-coding compliance parameters directly into our system, so we are able to securely reach our users where they are: on their phones. In fact, more than 85% of our web traffic comes from smartphones and tablets, and we are able to drive traffic to the right pages through push notifications on those devices. These notifications serve the same purpose as text messaging but are uniquely catered to that specific customer’s needs.

Web Portals

Portals and landing pages created for consumers should be exactly that: designed with them in mind. The vast majority of companies in the collections space have portals specifically designed for customers to manage their accounts, but 75% of those companies report remarkably low engagement through those pages. 

Creating an engaging portal means answering the question: “How can we make the experience personalized for the customer?” TrueAccord embraces this in its design methodology; Shannon Brown, TrueAccord’s Product Design Manager, says that our “we’re not pushing offers to them, we’re looking for information [about the nature of their debt] to customize for their needs.” Our design embraces our mission of giving consumer’s control of their financial health. 

You can learn all about TrueAccord’s design philosophy by listening to our full interview with Shannon here!

By focusing on developing interconnected, customized content that reaches users through multiple channels, we can reach consumers via email and mobile push notifications with the goal of bringing them back to our website. 

The debt collection industry at large has a long way to go to meet consumer expectations about financial services. Our machine learning algorithm optimizes which message to a customer to send on what channel, addressing those expectations and letting users manage their debt at their own pace. This is also why we work to provide our users with as much visibility into their debt as possible through easily accessible digital channels.

TrueAccord & CB Insights: Future of Fintech 2019

By on August 2nd, 2019 in Industry Insights

Ohad Samet, TrueAccord’s co-founder and CEO, joined thought leaders in fintech at CB Insight’s Future of Fintech 2019 conference. Learn everything you need to know about how TrueAccord is reinventing the collection experience.

TrueAccord is dedicated to revolutionizing the debt collection industry by redefining the user experience for consumers in debt collection. We work to empower consumers to regain control of their financial health and help them to better manage their financial future. Our product leverages machine learning for intelligent digital communications and empathy driven UX interfaces. 

The Debt Collection Market

Debt collection is an enormous market with nearly $13 billion in annual industry revenue. In the US alone, that equates to more than 17 million consumers per year who are impacted. These consumers are primarily pushed to provide payment by call centers which employ collectors —low-base, high-commission employees—who can contact a consumer to no end. 

Incessant contact from these collectors, whose own income is contingent upon collecting debts, can lead to anything from a rising number of complaints to the federal government to consumers exhibiting PTSD-like symptoms that are a direct result of feeling hunted by their collectors.

The Future of Collections

To combat this, we reimagine the collections experience. That difference comes from placing the consumer at the forefront of our collections strategy; the consumer is given the choice to engage with TrueAccord’s personalized, digital solutions at their own pace. 

This strategy empowers consumers to manage their debts in a way that makes sense for them and ultimately affords high customer satisfaction, whereby consumers feel that a weight has been lifted from them when they pay off their debt through TrueAccord. 

Machine Learning

By automating collections communications, we are able to craft a more personalized experience for our users. With over 6 million users on the platform, we use the aggregate data to better understand what makes each of those users distinct and how to best communicate with each individual that we service. The learning aspect of the platform continues beyond simple understanding; it makes our communication strategies more dynamic and can cater our content and outreach to each user.

User Experience

For TrueAccord, providing a positive user experience means being transparent and giving consumers the options they come to expect across other financial services. This is best represented by the fact that more than 80% of consumers on the platform are managing their account on mobile devices, not on the phone with agents. 

A positive user experience is just as necessary for TrueAccord’s creditor partners which have direct access and visibility into the inbound and outbound activity related to their debts as well as the amounts collected. 

Rules, Regulations, and Refreshing the Model

Samet recently served as a member of the Consumer Advisory Board of the Consumer Financial Protection Bureau (CFPB) to assist in reviewing current collections rules and regulations using TrueAccord’s data. The CFPB is currently developing legislation that promotes our model; this legislation will severely restrict call center-based collections and will encourage adoption of digital channels instead.

With TrueAccord leading these changes, we aim to continue our rapid growth by setting industry standards and making debt collection a more empathetic experience. 

AI in Banking podcast: Machine Learning for Debt Collection and Personalized Messaging with Ohad Samet of TrueAccord

By on July 22nd, 2019 in Industry Insights

The latest AI in Banking podcast features our CEO Ohad Samet as he talks about personalized messaging, collection forecasting, as well as his thoughts on branding and customer retention.

https://soundcloud.com/aiinbanking/machine-learning-for-debt