On July 28, the debt collection advisory committee of the California Department of Financial Protection and Innovation (DFPI), whose mission is to better protect California consumers, promote responsible innovation, reduce regulatory uncertainty for emerging financial products and increase education and outreach to vulnerable groups, held its inaugural meeting. TrueAccord cofounder, Ohad Samet, who is one of seven founding committee members, joined to set priorities and kick off the committee’s activities.
Samet’s voice on the committee, which is made up of a cross-section of industry experts from lawyers to academics to executives, brings his nearly two decades of experience in implementing technological and machine learning practices in fintech and debt collections, as well as the consumer preferences and trends uncovered through TrueAccord’s data-focused and more consumer-friendly approach to collections.
“We’ve been able to find a way, as part of the Consumer Advisory Board of the CFPB (Consumer Financial Protection Bureau), to meet with consumer advocates and more traditional industry players to find that space where, if we serve consumers effectively using tech and we find alignment, everyone wins,” said Samet in his opening remarks of the meeting. “It allows consumers to be served well and industry players to be able to operate in a way that is actually cost-effective and appreciated by everyone involved. I hope to bring that type of forward- and consumer-focused thinking in the collections space to the DFPI. Through use of tech, consumer research, listening to what consumers want and aligning with them at scale, we can make the world a better place. I really think this can be the result of our work here.”
Some common themes of the committee’s inaugural discussion were documenting the life cycle of consumer debt, technological solutions and making sure the DFPI understands those processes, according to California DFPI Senior Deputy Commissioner and the debt collections advisory committee program lead, Suzanne Martindale. Discussion also prioritized consumer communication best practices, licensing requirements, and how research can help support the DFPI’s mission
“Introducing tech and consumer focus into the debt collection process is a lot more than sending an email and hoping for the best. It’s bringing in the best practices from e-commerce combined with consumer research,” Samet remarked. “Consumers want to pay their debt when they’re able to do so and when it’s done in a way that’s convenient for them. We’ve seen a spike in online activity from consumers actively looking for ways to negotiate or learn more about their debt – which on one hand is encouraging and on the other hand is critical to understanding how we offer a path for these consumers to engage in a way that they feel is good for them.”
Though the goal of this first meeting was to develop next steps and action items for future sessions, members agreed that DFPI research on consumer communications and preferences would be helpful to shape how the consumer advocates and debt collectors can work together. On this front, Samet will contribute insights garnered throughTrueAccord’s current business practices and core values.
“Consumers feel at a disadvantage on the phone because they are not as equipped with negotiation skills or knowledge of the law as the collector on the other side. They want to default to digital, asynchronous communications so they can think between the beats of back and forth,” said Samet. “All of TrueAccord’s activity has been heavily slanted towards allowing consumers to engage on their own terms as much as possible. When you bring e-commerce and tech practices to debt collections, it leads to more productive conversations, more proactive communications, more expectation for choice in mode of interaction and more requests for customization.”
The formation of the debt collection advisory committee was announced in April in order to provide critical feedback to the DFPI as it stands up its debt collection licensing program at the beginning of 2022.
To watch the entire first meeting of the debt collection advisory committee of the California DFPI, click here.