How the collections industry can serve consumers in times of economic uncertainty

By on July 13th, 2020 in Industry Insights

Debt collection is a highly regulated industry and as such, is notoriously slow to change. While there are a number of reasons for this, the end result is a growing gap between consumer’s expectations and the services creditors offer.  

TrueAccord’s recent report, Consumer Debt in the Age of COVID-19, found that during times of economic uncertainty, this gap can grow even wider. Repayments may be irregular for the foreseeable future, so when consumers do choose to pay, it’s up to collectors to make the process as simple as possible. Now more than ever, it’s clear that the collections industry needs to catch up with other financial services and provide modern solutions for the consumers it services.

Debt collectors can pave the way for an improved consumer experience with context-aware messaging, flexibility, and opportunities for consumers to engage on their own terms.

Use Context-Aware Messaging

A consumer’s relationship with a debt collector begins well before any payment activities. While this relationship has traditionally been built on a series of letters and phone calls, today, it’s crucial to leverage digital channels and a context-aware approach. 

Consumers expect a personalized experience from their financial services, and debt collection should be no different. Customizing communications based on context improves engagement and enhances the customer experience. To succeed, digital debt collectors must leverage their messages from robust content libraries, selecting the right communication at the right time.

A key part of finding the “right” message is striking the right tone. Financial hardships are challenging to navigate and as a debt collector, being patient and offering solutions can make a world of difference. 

At TrueAccord, our machine learning engine, Heartbeat, chooses the “right” message to send from thousands of legally approved communications based on the millions of people TrueAccord has worked with in the past. We’ve found that the right content in an email can increase click-through rates by 20%. 

To be sure, optimizing content is about tone and timing — not increased frequency of communications. In fact, there are many safeguards in place to protect consumers from email overload. Not only will email service providers identify those who over-email as spam, but consumers can also independently unsubscribe or flag messages as spam if they feel harassed.

Provide Flexible Options

Offering consumers flexible payment options is not only better for customer experience, but it can have a dramatic impact on payment plan retention as well. Our research shows that consumers are 50% less likely to drop off of a flexible payment arrangement. 

While flexibility has always been a differentiator for debt collectors, it is especially important during times of economic hardship and uncertainty. Consumers are more likely to begin a payment plan if they are confident that they can adjust their payments to accommodate uneven or unpredictable cash flow. We’ve found that consumers are more inclined to pay off debts that they feel are manageable and are owed to a company they trust.

Introduce Self-Service Options

Today, consumers take care of most of their financial needs without ever talking to a human, and paying a debt shouldn’t be any different. Online self-service tools have become the norm across financial institutions and debt collectors need to follow suit to best serve consumers. 

All debt collectors should set up a payment portal so that consumers can seamlessly make payments online. This type of self-service tool reduces friction for the consumer by removing the need to speak to an agent and allowing them to pay at any time, not just during business hours. Our data shows that 17% of consumers access our website before 8:00 a.m. or after 9:00 p.m — times when they could never talk to an agent. 

To truly match the convenience of online banking, digital tools must also allow consumers to take a variety of actions including (but not limited to):

  • Adjusting the length and installment amount on their payment plan
  • Deferring a payment
  • Disputing all or a portion of their debt
  • Entering bankruptcy information
  • Applying for a hardship pause on their debt.

Implement Smarter Staffing

In times of national economic uncertainty, payments are likely to be inconsistent. For example, during the coronavirus crisis, we may see spikes in payment activity as individuals receive governmental aid or businesses are able to hire back their workers. Unfortunately, staffing becomes very complicated when there is uncertain demand. On top of that, operating a call center is currently harder than ever, with most states still requiring staff to work from home—a challenge for compliance, IT, and HR. 

One step companies can take is to prepare for spikes in payments based on leading indicators of future demand. These can include factors such as economic indicators (like unemployment rate), governmental aid programs (like the CARES Act), and consumer digital engagement trends (like click-through rates on emails). While these indicators won’t provide enough time to train a whole new team of agents, they may signal a good time to bring in your seasonal staff.

But in order to succeed in the long-term, debt collection agencies must introduce a digital-first model. Once someone decides to pay a debt, having digital payment options alleviates pressure on the call center. At TrueAccord, 95% of consumers resolve their debts without ever speaking with an agent. 

Needless to say, humans are still crucial. While machines are great at handling routine requests, there is no replacement for a well-trained agent to help customers with more complex situations. However, with the help of digital tools, each agent is more efficient. At TrueAccord, each agent is able to service more than 80,000 accounts (and counting) vs. a traditional agency’s 1,000-2,500. This type of hybrid model provides the best possible customer experience, even during busy times.


During times of economic uncertainty, debt collectors must adapt to an operating model that empowers consumers to manage their debts in the way that makes most sense for them. Based on historical trends, as well as the consumer behaviors we’ve seen in the first few months of the coronavirus pandemic, we recommend that all companies collecting debt should use context-aware messaging, provide flexible options, introduce self-service options, and implement smarter staffing.

New Report: Consumer Debt in the Age of COVID-19

By on July 7th, 2020 in Company News, Industry Insights

Today, TrueAccord released Consumer Debt in the Age of COVID-19, a report exploring how debt repayment and other consumer behaviors have changed throughout the coronavirus crisis. Based on aggregated, anonymized data from 12 million U.S. consumers, the report highlights that consumers choֵse to pay off debt when provided with an infusion of cash, even during a time of unprecedented economic uncertainty. Despite an initial slowdown as the crisis worsened in the U.S, debt repayment volumes hit a record high on April 15th, the day the first wave of CARES Act checks hit bank accounts.  

Key insights and trends from the report include: 

  • Consumers chose to leverage their CARES Act cash to pay down debt. On April 15th, there was a near-instantaneous increase in debt payments as the first wave of checks hit bank accounts. Payment dollars were 25% higher than the previous tax season peak. 
  • One-time stimulus changed consumer behaviors. With stimulus checks in hand, consumers flocked toward paying off their debt in full — the rate of lump-sum payments was 50% higher than the same period last year. The ones who did sign up for payment plans chose shorter payment terms with higher monthly installments. 
  • Payments will continue to be irregular. In early March, nationwide panic led to decreased engagement and payment activity from consumers. While stimulus payments and unemployment benefits empowered consumers to pay off debt in record numbers in April and May, that trend won’t remain constant over the coming months.

“TrueAccord has always known that consumers in debt aren’t villains or victims — they’re caught in a difficult situation, trying to optimize for day-to-day survival while managing their obligations,” says Ohad Samet, CEO of One True Holding Company, the parent company of TrueAccord. “So when presented with an unexpected windfall and fewer spending opportunities, many of these consumers chose to repay debt. This trend was especially clear for a company like TrueAccord, which puts consumers in charge, by providing self-service tools, rather than coercing them into making a payment.”

With an uncertain economy and the possibility of additional stimulus packages, debt collectors must be prepared for unusual spikes in engagement and payment in the coming months. In order to best serve consumers, they must streamline their processes to make it as easy as possible for consumers to pay their debts when they choose to and to modify their plans when they can’t. The report includes four recommendations that companies collecting debt can implement to update their operations for this unusual time. 

“Consumers have learned to expect digital-first solutions from their financial service providers, and the collections industry needs to keep up,” said Sheila Monroe, CEO of TrueAccord. “Our systems and processes empower consumers to engage when they want to, where they want to, using their device and channel of choice, and provide the flexibility to set up payment arrangements that fit their irregular schedules.” 

For more information, download the full report, Consumer Debt in the Age of COVID-19, here.

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Consumer Behavior During COVID-19 Crisis Provides Insights Into a New Era of Debt Collection

By on July 2nd, 2020 in Industry Insights

The COVID-19 crisis has rapidly changed the way individuals and businesses operate around the world, and with no clear end to the pandemic in sight, it’s unclear when, or how quickly, the economy will start to recover. To better understand the effect this uncertainty has had on debt collection, we analyzed data from over 12 million consumers of major banks, issuers, eCommerce companies, and direct lenders. 

In our upcoming report, Consumer Debt in the Age of COVID-19, we use this data to review consumer repayment trends, the role of stimulus checks in that process, and what debt collection companies will need to do to adapt.

Here’s what you can expect from the report:

  • Pre-coronavirus payment insights. In order to provide a benchmark for new or rapidly changing consumer behavior, we reviewed common pre-pandemic payment trends, like payment surges during tax season. 
  • COVID, CARES, and consumer concerns. We tracked consumer behaviors around engagement and payments throughout the crisis—from the onset to the declaration of a national emergency, passing of the CARES Act, distribution of stimulus checks, and beyond. Consumers were clearly concerned early in the crisis—engagement with debt was down 40% year over year in mid-March—but when stimulus checks provided an infusion of cash, consumers overwhelmingly chose to use it to pay their debts.

Click through rates plummeted in March as the crisis worsened, only to reach a record high post-stimulus.

  • What’s next for debt collection? As the crisis continues and consumer payments are slowing, debt collectors must adapt to survive. Based on the payment and engagement trends outlined in the report, we share four key steps debt collection companies can take to best serve consumers in the “new normal.”

If you’re interested in reading the full report, fill out the form below to get notified when it goes live.

Selling your debt vs. hiring a debt collection agency

By on June 25th, 2020 in Industry Insights

In the wake of the COVID-19 pandemic, a recession is looming, and consumer debt is on the rise. In order to prepare for the wave of consumers unable to pay money owed, companies need to decide how to manage their past-due accounts. 

Debt sales play a unique role in the collections industry, as choosing between selling to a debt buyer and placing accounts with a third-party debt collector can make or break a brand. Here’s what you should know about selling your debt portfolios and how you can recover late payments before you decide to sell.

What is a debt buyer?

A debt buyer is a company that purchases debt from lenders for a fraction of the full value of those accounts. The value of a portfolio is evaluated based on several factors including the age of the debt and the volume of accounts. All debt buyers are not created equally, as some may also own fully functional debt collection agencies.

Once a business sells its past-due accounts to a debt buyer, the debt buyer can:

  • Sell the accounts to other debt buyers
  • Send it to debt collection agencies
  • Collect on the accounts themselves (if they are a licensed debt collection agency) 

Selling your debt to a debt buyer

Pros of selling your debts

The most common reason that a company may choose to sell off debts to a debt buyer is that it can provide a quick influx of cash. Some consumer accounts may go unpaid for years, and older debts can be difficult to collect on. For smaller businesses, selling past-due accounts to a debt buyer can be especially helpful, as every late payment can feel like a larger detriment. 

Cons of selling your debts

Once the sale of debt is complete the debt is now owed to the debt buyer. Many consumers may not be aware of this transition, and the new owner—whether a new third-party agency working on behalf of the debt buyer or the debt buyer themselves—now represents a new business’s brand to the consumer. This puts pressure on businesses to choose a reputable debt buyer that will handle their accounts and consumers with care.

Compliance concerns

This change in account management can have legal and compliance implications if the debt buyer violates any collections laws. The Office of the Comptroller of the Currency (OCC) holds lenders accountable for compliance violations of third-party vendors.

While some debt buyers are extremely clear in detailing their compliance adherence, there is not a guarantee the buyer that acquires your accounts will be the last person to own it. This potential compliance risk should be paramount when deciding on any new vendor. Lenders should be especially cautious when deciding on a potential debt buyer.

Brand risk

New vendors, operating under their own standards, bring additional risk to your brand reputation when they begin to manage your consumers’ accounts. As mentioned before, consumers may not separate the debt buyer from the debt they owe. Maintaining your business’ brand reputation, even in collections, should be a key part of any business decision. 

Original creditors forfeit control over the methods of communication with their consumers when the sale of debt is complete. If a business does not choose wisely when selling its debt portfolio, the business is risking negative brand experiences that can potentially dissuade consumers from working with or buying from the company again in the future.

Short-term gains

While selling your debt can offer money for your business faster than a long-term debt collection strategy, it also means losing potential revenue later. Debt buyers pay for portfolios at a fraction of their total value, and if you’re able to build a consistent, long-term strategy you can recover closer more of the value owed. 

Hiring a debt collection agency

Pros of hiring a debt collection agency

Debt collection agencies, especially digital-first debt collection agencies, offer longer-term liquidation solutions for lenders. Debt collectors are able to work in conjunction with your existing consumer experience process and can strategize with you to meet collection goals. While some debt buyers have dedicated debt collection teams, third-party debt collectors remain a more active part of your own consumer life cycle. 

In addition, as the debt collection industry slowly begins to digitize, more powerful debt collection solutions are becoming available. Digital debt collection tools offer improved regulatory compliance, a better consumer experience, and improved liquidation rates relative to traditional call-and-collect debt collection strategies. 

Cons of hiring a debt collection agency

Working with a debt collection agency is still another vendor to add to a growing list. Debt is a regular piece of the consumer lifecycle, however, and all lenders should have a collection solution on hand. Some companies choose to build full in-house collections teams, but proper training can still be both time consuming and resource-intensive.

What solution works best for you?

Selling your debts may offer some immediate relief, and there are many companies that offer excellent service and care. Regardless of which debt vendor you decide to use, be wary of potential bad actors and do your research to understand the best fit. 

In an ideal world, consumers would be able to pay their bills in a timely manner, and lenders would not have any debts to collect on. Unfortunately, unexpected hardships and changes in income can put even the most financially-literate consumer in a difficult situation. Debt is a necessary part of any business, and it’s imperative that businesses choose the right option for themselves and their consumers. 

Do you still have questions before you make your choice? Talk to our team today. We can answer your questions.

How are Fintech startups changing debt collection?

By on June 19th, 2020 in Industry Insights

Due to regulatory concerns and a general wariness of adopting new technologies, the debt collection industry has historically been slow to change. As companies across other financial industries continue to make it easier for consumers to access their own finances, that resistance may finally be waning.

Point of Sale finance companies like Affirm and Afterpay are making it simple for consumers to pay for more expensive goods in installments. Digital payment platforms make sending and receiving money quick and easy. Banks with decades (or even centuries) of history have quickly accessible apps that give consumers immediate access to their accounts. Debt collection can’t miss out on this digital revolution. 

Fintech startups have started jumping into the collections and recoveries fray. These disruptors are providing improved consumer and client experiences, greater flexibility, and increased recovery rates. Here are four major ways that technology-driven companies are redefining the collections industry. 

Embracing modern communication preferences

Traditional debt collection agencies primarily contact consumers over the phone. According to Hiya’s State of the Phone Call 2019 report, only 48% of incoming calls are answered, and that number plummets to 26% if the caller is unidentified. Communication methods have dramatically diversified in the years since the FDCPA was passed in 1977.

Digital channels provide less obtrusive ways to engage with consumers. A technology-driven, omnichannel approach provides more options for a consumer that’s already plugged in. Even something as simple as having an active social media presence supports existing teams and improves brand awareness.

Analyzing and improving consumer engagement 

By transitioning to digital communication channels, innovative debt collection companies have a clear picture of each interaction a consumer has with their service. By applying artificial intelligence and machine learning to consumer engagement data, like email open rates or website browsing behavior, communications can then be optimized over time. 

Multi-armed bandit algorithms help expand this optimization process beyond simple A/B testing and offer consumers the message that best suits their needs. If, for example, a consumer opened an email and clicked on a link inside, but did not respond to the following three emails they received, the algorithm can determine a new, unique message to send that fits this pattern of engagement. 

These messages can also be optimized at a more granular level. By testing batches of messages with small changes in diction or different sized buttons, machine learning engines like TrueAccord’s Heartbeat can create the perfect message for each individual consumer. 

Building scalable systems

Digital debt collection solutions have a significantly smaller physical footprint than their traditional counterparts. Newer tech solutions can be integrated into existing debt collection strategies, and full digital debt collection agencies can scale without requiring the same staffing or training of traditional collections teams. 

By building code-driven compliance solutions into the software, fintech debt collection solutions can easily scale to securely service thousands of accounts. Automated communication tools mean that the majority of consumers can resolve their debt without having to speak directly to an agent. 

At TrueAccord 95% of accounts are resolved through self-service. Join our Director of Operations as she discusses how we uniquely manage the other 5%!

Another key, scalable advantage that technology-driven financial services offer is the ability to send emails to a large number of users. Properly scaling an email outreach strategy requires careful planning and testing. Traditional debt collection agencies can struggle to compete with the same email volume as dedicated technology companies that have laid the groundwork for email services in advance. 

Personalizing payment plans

Customized communications go a long way when growing consumer engagement, but helping them build payment plans that work for them is the ultimate end goal. Fintech companies in collections enable flexible payment plans that improve retention and decrease breakage rates. Consumers can adjust payment dates to coincide with their paydays, extend payment plan durations, or even request unique hardship relief options — all without ever talking to a human agent.

If a consumer sets up a payment plan and unexpectedly loses their job, it is not uncommon for them to call a debt collector and simply cancel a payment plan. If given more flexibility, they may be able to afford a smaller monthly payment as they get back on their feet. Since the process is self-directed, consumers are empowered to take control of their own finances. Technology-focused companies can focus on encouraging that through their products and services. 

Fintech debt collection startups continue to evolve and support consumers and creditors alike with new technology. Providing consumers with a personalized and customizable experience brings the debt collection industry in line with other financial services and makes paying off debt easy. 

Are you ready to start up with a new technology-driven solution? If you want to learn more, schedule some time to talk to our team today!

Guest Spot: Credit Ecosystem to Go with Tim Collins

By on June 18th, 2020 in Industry Insights
recording microphone in a sound studio

TrueAccord’s Chief Compliance Officer and General Counsel, Tim Collins, joins host Joann Needleman, Practice Leader & Member at Clark Hill PLC to discuss the evolving world of debt collection.

The inaugural episode of the podcast includes discussions around:

  • The digitization of debt collection practices
  • How industry practices are adapting to the COVID-19 pandemic
  • The need for companies to adopt these changes before it’s too late.

You can listen to the full podcast here.

How to create a consumer-focused experience: An interview with Cassie Cox

By on June 9th, 2020 in Industry Insights, Industry Interviews

Traditional call and collect debt collection agencies may see up to 5,000 accounts managed by each agent on their team. Increasing that number to 80,000 accounts per agent not only requires the support of powerful machine learning technology but an extensive training program. Cassie Cox, TrueAccord’s Director of Operations, discusses how her prior experience in collections and a unique training program has enabled our team to manage multiple communication channels and support a customer-focused experience.

Profile photo of Cassie Cox
Cassie Cox, TrueAccord’s Direct of Operations

How has your experience in debt collection shaped your approach to managing operations today?

I’ve been in collections for 25 years. I started my career on the phones as a debt collector myself, and I worked my way up to a supervisor position and eventually a department manager. I just kept going from there. I’ve had the opportunity to work across the country—North Dakota, Oregon, Virginia, and now Kansas—and in several roles where I was responsible for the agent experience. 

Consumers’ expectations have changed significantly. I remember when having an IVR (interactive voice response system) manage call flows was an annoyance to people. Customer experience scores would plummet because of them. Someone would call in and want to speak with an agent, not a computer. 

Today, no one wants to talk to an agent anymore. If someone has to pick up their phone, hearing an IVR is their best-case scenario. You have to meet your customers’ needs from tomorrow, today, and improving the overall customer experience with your company starts with having the right infrastructure in place. You need to ask the right questions:

  • How are consumers trying to engage with you?
  • What tools do your agents need?
  • How do you develop those tools?
  • What processes do you build?
  • What controls are in place to maintain consistency?

All of this helps to make sure that the customer experience comes to life in the way that you design it and doesn’t go off the rails. You can use these guidelines to train new hires and manage new process deployment in the future, and you can manage this by building a quality knowledge management system.

Speaking of processes: as I understand it, our agent training process is pretty extensive. Can you walk me through what training looks like and why that’s the case?

The key differentiator for our training process is really that our agents are working closely with TrueAccord’s technology. Agents in a traditional call center are regularly managing payments and routine account questions. When 96% of our consumers are managing their accounts through self-service, the consumers that do email or call us truly need help.

Machine learning technology drives TrueAccord’s consumer experience. If you want to learn more about the role of machine learning in debt collection, you can read more here.

This means that our call types are typically more challenging, and we need to rely on more complex problem-solving skills. So our goal with our training is to create a team of elite problem solvers.

Agents also have their own technology to learn and manage. We have our own CRM that helps automate scripts and disclosures that prompt agents so they don’t have to memorize a unique playbook for every client. If, for example, a creditor has a unique out-of-statute disclosure, that information can be built into our system, so we make sure that our team sees it when they need it. 

These processes are fairly standard in the collections space, but they still require training. The biggest reason that our program is a full six weeks is that our agents are managing multi-channel communications. I’ve worked with larger companies where you have one team dedicated to email, one for inbound calls, and another for outbound calls. Our agents are managing all of our channels at once.

“I’ve worked with larger companies where you have one team dedicated to email, one for inbound calls, and another for outbound calls. Our agents are managing all of our channels at once.”

A new hiring class will spend two weeks in a classroom setting designed to teach Collections 101. This ten-day period is meant to go over subjects like the differences between first party and third party collections, defining pre-charge off versus post charge off debt, and who our clients are. Reviewing collections laws and regulations is also a foundational part of the education process, and then we finish off by walking through our communication channels and TrueAccord’s systems.

The next week, these agents begin to manage inbound email communications. Once they feel comfortable with email, we have another week of phone training before they spend the fifth week managing calls. Then, in the last week of their on-the-job training, they are working both email and phone communications.

I’ve seen other companies with training programs that last anywhere from two to four weeks, and it’s great to have people ramped up quickly, but you also have to balance that with high attrition rates and error rates. 

Our training team is also incorporating a comprehensive suicide-prevention training into our agent onboarding process as well as for our current staff. A surge in unemployment and growing anxieties about financial stability and personal health due to the pandemic have contributed to an increase in consumers that are in need of more than simple financial assistance. Our agents experienced this surge first hand, and we want to equip them to successfully navigate these difficult conversations. This includes being able to deescalate potential life-threatening situations and referring to resources like the National Suicide Prevention Hotline (1-800-273-8255).

Even here at TrueAccord, the process has improved over time, and we continue to improve our training methods because we want to set people up for success. 

Some improvements and changes have been expedited recently. You recently hosted a webinar with Tim Collins [TrueAccord’s Chief Compliance Officer and General Counsel] about shifting agents to a work-from-home environment that has generally gone very well. The COVID-19 pandemic has made a huge impact on work standards and practices, but are there other challenges we’re working to address at the moment?

If we’re talking about larger-scale challenges, it’s important for us to continue improving our training and helping our agents navigate conversations and negotiations with consumers, but that need has also been amplified by COVID-19. The pandemic sent the nation and the world into crisis mode, and for us, that meant that when a consumer reached out and said they had been impacted and they couldn’t pay, we would tell them “It’s okay, we understand.” 

If you’re interested in learning more about how to adapt to new work-from-home needs check out the full webinar with Cassie and Tim here!

TrueAccord has also worked directly with many of our clients to implement a hardship program to offer further assistance to consumers directly impacted by COVID-19. 

Unfortunately, whether they’ve been impacted or not, their debt still exists. Now we’re working on guiding them through the process and focusing on “It’s okay. We understand. Let’s work with you to get through this.” It’s easy to hear someone’s concerns and say “you don’t have to pay right now,” but we can do more than that for them by discussing their options.

Thank you Cassie for sharing some insight into our training process and for your continued dedication to creating a positive consumer experience with our team. Building a system that supports and educates consumers leads to long-term financial success, and our agents are a core part of that.

Are you looking for a new type of collections solution? Talk to our team today to see how our machine learning engine and our expert agents can improve your recovery rates.

TrueAccord discusses adapting to work-from-home

By on May 21st, 2020 in Company News, Industry Insights

TrueAccord’s Director of Service Operations, Cassie Cox, and our General Counsel & Chief Compliance Officer, Tim Collins, hosted a webinar on May 13th, 2020 to talk through collections continuity in light of the COVID-19 crisis. The team discussed adjusting to regulatory changes, how to effectively manage a work-from-home approach in collections, and what the future of the industry may look like. 

How are federal and state regulations changing?

Federal-level regulatory updates

The pandemic has prompted the US federal government to examine how it can work to aid Americans in need. Following the CARES Act, the House has proposed a new, $3 trillion relief package, and we are likely to see other potential stimulus packages discussed as the Senate proposes their own stimulus plan. Major industry organizations like insideARM and the ACA International are watching these unfold closely, as should we all. 

The Consumer Financial Protection Bureau’s activity has not slowed during the pandemic, and they are on track to meet their examination goals this year. Remote auditing processes are in place and buzzing. They may not be in your offices, but the CFPB’s teams are still actively working to ensure the industry remains compliant.

State-level regulatory updates

Several states, including Massachusetts and New Jersey, are pursuing legislation that directly impacts the ability of collectors to reach consumers. Massachusetts’ Attorney General recently enacted an emergency law that outright banned collections efforts.

This was fought by the ACA, and the law was declared too broad and in violation of First Amendment rights, but the changing playing field does not end there. New Jersey has worked to pass similar legislation which has now been narrowed to primarily impact medical debt collection practices. 

There will also likely be a heightened focus on state budgets and an increase in understanding how to bolster state economies. 

As of this writing, forty-seven US states are either reopening or partially reopening by lifting shelter-in-place orders. Twenty of these state legislatures are now back in session and may begin to make other changes that collectors should keep an eye on. There will also likely be a heightened focus on state budgets and an increase in understanding how to bolster state economies. 

One major change that seems to be for the better is the newfound flexibility for collection agencies and other companies to allow employees to work from home. This behavior is being echoed by Rhode Island’s new “stay healthy” order which has started the reopening process but is strongly encouraging employees to work from home when possible. Collections is beginning to adapt to the changing need, and TrueAccord was able to adapt quickly.

How is collections operations changing?

Maintaining control and information security in a work-from-home environment

TrueAccord’s team began to prepare for potential risk to our operations in early March by reviewing and updating our practices, policies, and procedures to make sure all of our teams could effectively work from home. 

Here are some of the standards we established as we transitioned 80% of our agents to work from home full-time:

  1. Replicate an effective office space
    1. Agents must have a private area in their home and commit to working their shift uninterrupted.
    2. Agents must have a minimum internet speed of 50Mb/s in order to maintain high sound quality on calls.
  2. Enhance work from home agent information security
    1. Agents do not take payments over the phone. All payments are received via IVR or guided through our secure payment portal.
    2. Agents are not permitted to have cell phones near their workplace.
    3. Agents are monitored by their supervisors via webcam with at least two random checks throughout the day. 
    4. Calls are randomly monitored by supervisors to ensure continued commitment to exceptional customer service and quality.

These were only made possible by bringing on new technologies and building processes before we dove in headfirst. We also made sure that all of our agents fully understood these new practices in advance, and they signed off on the policies ahead of time. The 20% of our team members that are still in-office (at safe distances) continue to meet the same standards as the other agents. 

Our contact centers directly support our omni-channel approach to the industry. Here’s information on three other channels we use to reach consumers.

The remaining 20% either opted to not work from home due to a lack of interest or they were not permitted due to their homes not meeting security requirements (e.g. not having a private space, not having a fast enough internet speed, etc.). 

Managing agent performance standards remotely

Call centers are filled with high-energy individuals that are driven by their wins. Maintaining the same hum and energy of an office space without sharing the same space is difficult, and we’ve taken steps to keep our agents excited about their work.

Meet (virtually) Face to face 

A robust virtual management system has been put in place to keep building our team’s connectivity. The webcams we provided to our agents not only help with security monitoring but also increase our ability to build team morale. All of our agents are dialed into (and muted on) a Google Hangout or Zoom meeting throughout the day so that at any point they can turn and see their teammates working hard. 

This practice has also extended to our new management strategy. All of our contact center team meetings are required to be on camera so that we get face time with each other. These meetings include small group meetings, individual coaching sessions, and any other 1:1 meetings as well. 

Encourage conversation

Look for opportunities to create additional team touchpoints. Our current structure includes:

  • Weekly coaching sessions
  • Weekly team meetings
  • Random, weekly 15-minute huddles

We also have a wide range of Slack channels in place for sharing anything from anecdotes to best practices. In an office environment, it’s easy for folks to look over their shoulder and share tips and tricks, and those conversations drive positive change. Slack (and other work chat tools) also provide ways to circulate urgent updates with ease.

Keep the excitement up

We’ve increased our budget for intra-day chachkes, small giveaways, and rewards. Our in-office management style was largely visual: performance trend boards, goal setting boards, and team-based competitions were huge drivers for us. Now, we’re turning to setting up more contests. In this environment, a $10 gift card can get almost as much traction as a $50 card. It’s the thrill of the win, not necessarily the prize itself. Keep the energy up!

Monitor issues closely

The first two weeks of the work-from-home experiment were an amazing honeymoon period. There were three, consecutive days of perfect attendance in our contact center. Typical efficiency metrics like production volume per hour and average handle time have remained consistent. Keeping the same levels of performance is another story entirely, and close performance management is critical to making work-from-home, well, work.

We continue to track month to date metrics and just as closely monitor individual daily performance. Though many of our agents had no issue moving to a home environment, just as with any contact center, the bottom 10% of our group semi-frequently underperforms. It’s more essential now to keep a careful eye on red flags and correct underlying issues immediately. 

The biggest concern was properly tracking things like call or work avoidance or time card manipulation. Thankfully, with all of our systems are aligned and our supervisors actively checking on their teams, the only instance we found was caught immediately. 

Terminating a remote employee

Unfortunately, this is a necessary part of any operations manager’s role. In a work-from-home world, we still want to make it as direct an experience as possible. The full investigation, conclusion, and termination conversation should all be conducted via video conference.

Beyond the human aspect of termination, there are data and security considerations that should be tested ahead of time. Your team should understand how and when data should be cleared from a remote employee’s computer, and systems should be in place for the employee to either drop off or otherwise return their gear. Remember to accommodate for the possibility of lost assets. Some folks, even under contract, may not return your stuff.

What is coming next?

Changes in the office

The COVID-19 pandemic prompted a lot of changes to the way companies operate in general. While it continues to unfold, we are likely to see more change. That said “Right now, maintaining [business continuity] means not changing anything,” said Cox. 

As shelter-in-place rules begin to lift, and we see some employees return to their offices, we will see physical changes:

  • New desk layouts
  • A possible return to cubicles or dividers and a shift away from open-plan offices
  • New air filtration standards for enclosed spaces

Changes in the industry

While the US economy recovers, we expect to see a massive wave of customers that are unable to pay their bills. Unemployment rates will continue to drive payments from slightly overdue to collections, and debt collection agencies and internal recovery teams are likely to struggle to meet the account volume. 

“Collections has long been driven by human capital,” said Collins in discussing the need for contact center agents. “Technology will have to step in and fill a new, higher demand.” He went on to add that alongside the increase in volume, we expect a change in collections mentality. In order to overcome the disparity between payment deadlines and consumers unable to meet them, there will be a rise in customizable payment plans, hardship plans, and digital, self-service tools.

Crises drive rapid evolution and change. Many business practices and technologies that were slowly gaining traction in a pre-COVID-19 world are now fast-tracked. Working from home is a must at the moment, and the collections industry has to embrace that. Moving forward, we’re likely to see new innovators that are reinventing an aging industry, and it’s time for collections to adapt. 

Stimulus check payments surge over tax season trends

By on May 14th, 2020 in Industry Insights

Consumer debt in the US is climbing rapidly. A 1.1% growth to $14.3 trillion in Q1 of 2020 places the total debt higher than its previous peak of $12.68 trillion in Q3 of 2008. This growth may not be directly tied to the pandemic, but it does represent a large problem as a recession looms. Our teams have the ability to see some patterns and trends that arise in our repayment plans and consumer payment habits amidst these changes. Business partners span several verticals, and our data represents a broad spectrum of consumers in debt. 

A (not so) unexpected trend

In a typical year, like many other collection agencies, we see the highest volume of debt repayment when consumers use any tax return to pay down existing debt—February to the beginning of April. This year, however, an unexpected spike in late April and May dwarfed our Year Over Year trend thanks to the CARES Act stimulus checks. 

To put this into perspective, Americans received the first major wave of CARES checks on April 15, 2020. On that day, debt repayment volumes were 22% higher than on February 26, 2020, the first-day that tax refunds were disbursed by the IRS.

The higher volume of payment plans created and money spent were matched by an exponential increase in inbound consumer engagement, both over the phone and through our online portal. TrueAccord wasn’t alone in this trend either. Consumers flooded major debt collection agencies, who saw 2.5 times the inbound call volume and 2 times online traffic compared with a regular April day. TrueAccord’s CEO, Ohad Samet, had this to add:

We are actually not surprised by this. Borrowers that we work with are in a state of financial uncertainty most of the time, so crises like this are unfortunately not far from the norm for them. A sudden inflow of cash like a tax refund or a stimulus check is an opportunity to get on more sound financial footing by paying off debt. 

When they do have money, they go to brands they feel an emotional connection to, and TrueAccord has spent years building a reputation as a trusted partner for consumers in debt. That’s why we’re seeing an unusual surge.

The COVID-19 pandemic has impacted the global economy in unprecedented ways, but there is still some data that helps us understand what consumer spending habits can be expected in a recession. Maintaining communication with consumers affected by the pandemic and helping them to navigate this complex financial crisis is a necessary process.

Options empower consumers to pay when they can

Several states like Nevada and Massachusetts are restricting debt collection practices in an effort to stop collection calls during a time of potential sickness or unemployment.  However, as Samet mentioned, debt collectors regularly encounter consumers who are going through hardships that often lead to their indebtedness.

During times of financial stress, it is equally important that we provide consumers options and tools to manage their accounts as they see fit and when they are able based on their personal situation. As evidenced by the sheer volume of payments submitted in our system after consumers received their stimulus checks, consumers desire to pay down their debts when they have the financial ability to do so. 

There are many resources available for consumers that are experiencing hardships, and we want to empower consumers in debt to get back on their feet.  Kelly Knepper-Stephens, VP Legal & Compliance, explains:

As a collection agency, we can help by providing consumers with the ability to self-serve using tools that offer flexible options including non-payment options, such as options to dispute, apply for hardship, stop phone calls, or unsubscribe to emails. Consumers appreciate the opportunity to make all these decisions when they have the time and ability to do so, which is why it is critical to be able to provide consumers with 24-hour self-service options.  

Empowering the consumer with these choices and with the ability to communicate in the manner they prefer (which may or may not be over the telephone) can bring relief about existing obligations during a stressful time. A lack of options can feel restricting and stressful, and our data supports the power of choice.

Want to see how a digital platform can improve your consumer engagement? Reach out to us for more information!

What is skip tracing in debt collection?

By on May 12th, 2020 in Industry Insights

When a consumer falls into debt, and they are unable to pay off their accounts, debt collectors are brought on board to recover payments on these delinquent accounts. Occasionally, a consumer, feeling they are out of options and entirely unable to complete payment on their account will stop responding to communications from a collection agency. In some instances, breaking the line of communication is entirely accidental. 

If a person moves, and they don’t update a forwarding address, letter-based communications may be completely lost, and with 95% of collection agencies continuing to send letters, this can lead to a massive drop off! Consumers that have accumulated large amounts of debt may be forced to move frequently or are left without a home entirely. These consumers know that their debts will not disappear, so how do you communicate with them to discuss and resolve their account?

What is skip tracing?

Skip tracing is the process of collectors actively locating consumers that owe money on an account. The term comes from the phrase “to skip town,” and can make it seem like these consumers are intentionally abandoning creditors’ attempts to reach them. 

How is skip tracing conducted?

Skip tracing in collections is sometimes necessary to close out these long-forgotten accounts. Skip tracers are dedicated to gathering as much information about a consumer as possible in order to clarify their most accurate and up-to-date information. As more traditional collections methods are shifting to a digital approach so too is skip tracing.

Major names in the finance world like TransUnion and Experian offer powerful, data-driven, digital skip-tracing tools that help update contact lists live. These tools draw from accessible lists of user data to pinpoint consumers that may have updated their contact information elsewhere online including:

  1. Local exchange carrier listings
  2. White pages
  3. Credit files
  4. Other proprietary lists acquired by the company

Some third-party debt collection agencies also retain a dedicated skip-tracing service in order to accommodate these hard-to-reach accounts. Unfortunately, there is a chance that some accounts are simply lost, but by employing proper tools, even in-house collections teams can minimize the number of customers that skip out. 

Another important step in reducing the need for skip tracing all together is to gather consumer email addresses as another point of contact. Over 244 million people in the US have registered email addresses. They are not tied to locations, and most importantly for consumers in large amounts of debt: they are free to open and maintain. 

It is also possible that a customer may intentionally hope to evade a creditor if they feel they are being harassed by aggressive collections techniques or if there are no payment options that work with their budget. Fostering consumer relationships with customers that are past due on their account may seem counterintuitive to some businesses, but creating a positive customer experience should be at the forefront of any collections strategy. 

This extends to offering payment plans to accommodate customers at any point in their customer lifecycle. Working with these consumers proactively to build a plan that they can afford prevents the need for reactive measures down the line. In order to effectively contact consumers in debt, teams must adapt to changing consumer preferences, actively work with their customers, and encourage them to retake control of their finances. 

Using a consumer’s preferred contact channel can go a long way in preventing lost contact. Talk to our team to learn how going digital today helps you tomorrow.