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.

TrueAccord is redefining the collections experience. In order to grow as a company and continue to revolutionize the industry, we’ve redesigned our website to better reflect our dedication to a positive user experience! Designing for the user Being a leading modern debt collection solution means striving to provide a better experience for consumers in debt and creditors alike. The first step in this design process was revamping the website architecture to reflect our business growth, with industry and role-specific pages, as well as more details around our unique product and superior performance.  Fig. 1: The new homepage (left) provides an immediate look into who we are, what we do, and (literally) illustrates our value propositions for everyone to see!  If a user arrives on the site without any knowledge of AI or machine-learning, we still have to be able to explain what we’re capable of! This is why we’ve also included our awesome product showcase video below and directly on the homepage! Designing for the future We recognize that the collections industry is often cast in a negative light, and TrueAccord is here to create an empathy-driven collections experience. Right now, not everyone fully understands what that means. Having a platform for our brand’s voice and mission means we can more accurately and effectively reach creditors looking for a collections solution.  With this improved website redesign, we can ensure that when a creditor is looking for a new collections strategy, they recognize that today’s customers expect a service that considers their experience. We know that the future is digital, and now we can share evidence of that with everyone! By proving that we’re worth listening to and making TrueAccord a collections authority, we will redefine the industry. The impact of change I had the chance to sit down and speak with Shannon Brown, TrueAccord’s Head of Design and lead designer on the website rebranding, and Vivian Chau, Senior Manager of Brand and Content Strategy, to discuss the intent behind the redesign, the power of future-proofing our strategy, and what’s next for TrueAccord’s image.  How do you feel the new site will help us better serve our audiences? Brown: The first thing, I think, is that we're a digital-first, technology-driven company in an industry that isn't always fluent in the language of technology. Chau: Right, we knew that the website had to showcase what makes us a leading tech and customer-focused collections service, and the next step in drawing attention to that is having a website that helps potential clients learn about how collections fits into their revenue cycle management. We still want to be able to showcase our modern collections approach and how we leverage machine-learning, but the heart of that is driven by customer empathy. With dedicated sections on industry-specific information and more details highlighting our product performance, I'm excited to share and build upon TrueAccord’s new digital storefront. Brown: We also worked closely with our sales and client services teams to understand questions our clients have and included a Solutions section to better address how TrueAccord can help businesses across different industries and roles.  That leads to the next question, then: are there any features of the new site that you’re especially excited about? Chau: Yes! I'm particularly excited to have our new website on a standalone Content Management System. Our content team will be able to add and optimize the website without having to ask for Engineering help which gives us a lot of flexibility. I see this project as a jumping off point for our marketing and brand initiatives, as our website, as should our brand, needs to continually evolve and change with the company as it grows.  Brown: Speaking of growth: we’re working to attract top talent here, so I’m excited about our revamped careers page. It truly reflects the experience of working at TrueAccord and gives prospective employees more information about what it’s like here. Part of that TrueAccord experience is that we’re working to stand out in the industry. Our new About Us section really highlights our commitment to empowering consumers and delivering great user experiences, and that our mission and company values tie everything together. You both touched a bit on the impact that a clearly stated mission has on a company’s brand reputation. How did you go about the design process knowing with TrueAccord’s consumer-driven mission in mind? Brown: We wanted to give consumers a space on the site. A lot of consumers receive an email from us and come to TrueAccord.com to see what we’re all about. The previous website spoke to our partners, but didn’t really give consumers information about how the TrueAccord experience can benefit them! A big part of that was redirecting our focus to how our technology increases recovery rates and creates great consumer experiences instead of explaining the technology itself. Chau: It was important too that we created something that was easy for everyone to understand. We still want to be able to showcase our modern collections approach and how we leverage machine-learning, but the heart of that is driven by customer empathy. The redesign articulates that and the hope is that it excites prospective clients and potential job candidates.  TrueAccord is on a mission to change debt collection for good. With powerful tools in place, we continue to expand and grow and better showcase our product, highlight our performance, and demonstrate our values to clearly illustrate what sets us apart in the collections space. Want to learn more about TrueAccord? Connect with our team!

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!

It has been nineteen years since the Seventh Circuit held that a debt collector must include a notice to consumers if the balance in a collection communication would change from day to day due to interest, fees, or other changes accruing on a debt. However, we still see balance-related issues today under the Fair Debt Collection Practices Act as some debt collectors struggle to provide consumers with the amount of debt owed in a simple, clear manner.   Since Miller, other courts agree that a consumer must be told if the balance will increase adopting Miller’s safe harbor language. In September 2019, a court in the Eastern District of New York dismissed a case, finding the collection letter adequately set forth the amount owed because the letter included the safe harbor language. "Additionally, debt collectors should not put the safe harbor language on an account where the balance will not increase." In Paracha v. MRS BPO, the fact that the balance on a second letter (mailed six months after the first letter) increased by thousands of dollars did not make the original letter deceptive or inaccurate. This decision was made because the first letter advised the consumer, through the safe harbor language, that the balance may increase over time. Using (and not using) the right language Debt collectors must be careful with the safe harbor language and cannot simply add it to a communication when a balance on a collection letter will increase. The safe harbor language must be accurate for the particular account in question. The safe harbor language will only be safe to the extent that it states what may cause the balance to change.  For example, according to Boucher v. Finance System of Green Bay, Inc., if the debt will increase due to interest—not due to fees or other charges—then the safe harbor language should only advise that the balance may increase from day to day due to interest and not mention fees or other charges.  Additionally, debt collectors should not put the safe harbor language on an account where the balance will not increase. Doing so could create a false sense of urgency, and a consumer may think that they need to pay the balance immediately or it will increase when in fact it will not increase. Debt collectors are not required to tell a consumer that a balance will not increase.  Courts have made clear that a debt collector has no obligation to state that the balance will not increase when the balance on a collection communication is static. But, even when a debt is static, a debt collection agency must choose their words carefully when describing the amount of the debt owed. In Koehn v. Delta Outsource Group, Inc., a consumer sued a debt collector, arguing that the words “current balance” materially mislead and confused the consumer into thinking that the balance would change from day to day. The Seventh Circuit found that the phrase was “common and innocuous” and not a violation of the FDCPA. Itemizing debt Debt collectors should be wary of itemizing a debt when the debt collector does not have the right to add interest and fees. The CFPB’s proposed rulemaking does include debt itemization; however, until the rule becomes final, cases like Virden v. Client Services, Inc., suggest that listing “zero dollars” for interest and fees could mislead a consumer into thinking that interest or fees may increase. This deception would, in fact, be in violation of the FDCPA. In Virden the agency included the following itemization: Balance Due at Charge-Off$1,658.91Interest$0.00Other Charges: $0.00Payments Made:$0.00Current Balance:$1,658.91 The court found that the least sophisticated consumer could misinterpret the “$0.00” listed for interest and other charges and that one plausible misinterpretation could be that interest and other changes would begin to accrue if the debt was not paid. Since interest and other charges would not accrue on this debt, the court ruled that the information was deceptive. Agencies need to be careful in choosing what words they use describing the balance owed on a debt. In this context, less is more. Do not add itemizations when not required and only use safe harbor language tailored specifically to the account.  For more discussion of current balance issues, listen to the most recent episode of Two DEBTicated Attorneys.

Call centers are notorious for reaching hundreds, if not thousands, of consumers several times per week (and even several times per day!). The debt collection industry is plagued by the perception that collectors are relentless and uncaring, which makes resolving debts even more challenging. Digital debt collection strategies aim to alleviate the stress of incessant calling for consumers, and also provide unique, powerful solutions for creditors. Collection metrics Digital-first debt collection strategies provide creditors the ability to track and aggregate more objective performance metrics that help strengthen their collections strategy. Qualitative metrics from traditional call centers are still subject to the endlessly variable human element of a phone call.  When outreach is entirely automated, it becomes easy to A/B test simple changes (new subject lines, different greetings, etc.) and determine which are the most effective. But how do we define effectiveness? At the end of the process, an effective collections strategy is one that leads customers to make a payment.  There are a few key metrics that call centers use to drive customers to this end goal that can be easily supplemented or overtaken by digital collection strategies. Calls per account and calls per agent Traditional collection agencies, like any other sales call center system, track the total amount of calls made to each customer and by each agent on the team. When individual agents are responsible for contacting customers, they have to hit an outreach quota. This quota reflects directly back on the calls per account, or how many times an individual customer has been contacted.  As agents are required to call customers and collect on accounts, the calls per account may increase to a point where customers feel overwhelmed and over-contacted (which can even lead to symptoms of anxiety and depression). At the same time, if countless calls are being made, and an account is not paying, there is a clear gap in effectiveness.  One of the advantages of a digital debt collection strategy is that agencies can reach customers with relevant messaging at times that work for them. This can include hours in which call centers are no longer legally allowed to reach a customer—before 8am or after 9pm. With these legal limitations in place and the need for agents to meet quotes, traditional collections strategies encourage an artificial inflation of outreach numbers that may not be positive. Hit rates, percentage of outbound calls resulting in promise to pay (PTP), and call quality  Call volume is not the end-all-be-all of call center metrics though. Simply tracking output numbers isn’t enough when engagement is the key metric. Hit rate is defined as the total number of calls divided by number of those calls that are answered by customers. While this number can be helpful in narrowing which calls were more successful than others, it cannot reach the same level of detail as a full digital strategy. In the case of a phone call, there are limited options once the phone has been dialed: The customer does not answerThe customer answers but ends the call before promising paymentThe customer promises to pay Trying to understand what leads to a successful payment on a call is then dependent on the agent’s perspective. Digital debt collection conducted through machine learning is able to communicate using personalized and consistent content. Hit rate, PTP, and call quality analysis can then be expanded on, and performance can be measured by: Email DeliverabilityEmail open ratesLink click ratesWebsite engagement (Including clicking on further links, filling out forms, viewing specific webpages, and more)Online payments These data points can help pinpoint where in the process a customer was lost, improve the next attempt at outreach with that data in mind, and eventually guide the account to a payment. With more data and longer periods of time, machine learning processes only continue to improve. Updating your collections strategy  TrueAccord takes our digital strategy a step further by looking beyond simply using digital channels and focuses on the power of machine learning to continuously improve our collections performance. We've come to understand that creating an effective, empathetic collections experience actually comes from creating a more analytical and AI-driven process. With better visibility into performance, more granular data points, and more accurate reporting available than ever before, digital debt collection strategies strengthen the power of any collections team.

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 reachableA customer is unable to payA customer declares bankruptcyA 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. 

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 debtMedical debtCar loan debtHome loan debtPersonal loan debtBusiness debtStudent 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!

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.

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 addressThe 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 creditorState the amount owedProvide 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 emailsTelephone contact informationThe 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!

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 “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.