The COVID-19 pandemic has presented the collections industry with unprecedented challenges, including new regulations, changing consumer demands, and a potential surge in activity as forbearance nears its end and forbearance disappears. The pandemic continues to impact everyone’s lives, and besides inflation and market volatility, the only thing certain is the ongoing uncertainty. As lenders and third-party collection agencies plan their next steps, a solid assessment of collections processes should be a necessary starting point.
The more tools you can use and optimize in such new territory, the greater your chances of high returns. Therefore, leveraging the best data and analytics on the market—coupled with innovative solutions—is essential to your collections roadmap. Using data to automate and streamline — while empowering your approach to risk detection and mitigation — can get you on the right track.
Your overall strategy should focus on the following areas:
- Use of the best available data and digital solutions
- Increase the agility of your end-to-end debt management process
- Use tools and services that keep you informed of regulatory developments
Adjusting your approach can help minimize losses, optimize resources, and maintain relationships so you can collect debt faster and improve cash flow. Best-in-class data and analytics provide a more comprehensive view of consumers, which can result in higher recovery rates when deployed tactically across the collections lifecycle. To do this, let’s expand on the above concepts.
Access the best data and digital technologies
Data providers have a wide range of digital solutions designed exclusively for the collections industry and its unique needs at every stage of the collections process. For example, collection management software, skip tracing, and contact information tools with advanced analytics can help identify, prioritize, and assist in contacting and communicating with consumers. Combine these with other digital options that help with treatment and monitoring, and you can evolve your collections processes to run as smoothly as possible for both your employees and your customers.
Solutions that provide optimal insight into the consumer’s financial picture can support risk management efforts. The deeper your consumer view, the stronger your prioritization insights. By better understanding and meeting consumer needs, you can intervene earlier to prevent late payments and collect larger amounts.
With the proliferation of digital devices, connecting with consumers at the right time through the right channel can enhance their experience and increase the likelihood of collaboration. Collections should be viewed as an omnichannel opportunity that can result in better response rates and less stress for the consumer.
Increased agility in end-to-end debt management brings value
A lack of investment in the latest solutions can leave your organization struggling with severely outdated technology and processes, leaving little room for customization or optimization. Say you need to develop new payment or forbearance tools? Or do you need options that allow you to react quickly to fluctuating market conditions? There are solutions to help you remain agile and profitable in the face of these variables.
Solutions that leverage machine learning and artificial intelligence are transforming the way debt is collected, and using these tools effectively is critical. These technologies can analyze vast amounts of data from various sources and apply algorithms to improve existing processes and gain new insights into default risk and manage vulnerable accounts. By taking advantage of all available benefits, you can set yourself apart from your competition.
Find options to meet and manage regulatory developments
One of the biggest challenges for collections is adapting to constantly changing regulatory frameworks. When you can assess emerging vulnerabilities and update policies, you can better respond to market shifts and changing regulatory requirements. Ensure your debt management strategies are fair and compliant with all applicable regulations and policies with the latest solutions.
From best-in-class data to innovative compliance solutions, an industry partner offering a range of options across the debt management lifecycle can help you strengthen your bottom line.
Connect with a partner with industry-leading data, technology, and deep industry experience
The uncertain economic environment continues to affect the debt collection industry. With ongoing compliance requirements, evolving consumer demands, and an expected increase in collections volume, collections departments and agencies navigate an industry that is in constant flux. Fortunately, there are never-before-seen opportunities to unlock innovative solutions to mitigate challenges and reap benefits as we enter the next phase of our global economy.
experiential strives to provide its partners with the best available solutions and personalized customer service to optimize your efforts at every stage of the collection lifecycle. Realign your strategies today to prepare for tomorrow with a trusted, industry-leading data and analytics partner.