A significant number of Americans are under the burden of debt clearance. Moreover, delinquency is equally rising. As per the Federal Reserve Bank of New York, household debt was recorded to be $15 trillion in 2021. The COVID pandemic led to high inflation rates threatening to increase the number of debtors at risk or in delinquency. Among Americans carrying debt, a segment of the population that’s in a constant state of at-risk or delinquency. What matters is how you treat customers and their experience with you during debt delinquency. Now, this can significantly impact not only collection rates but also your success during the retention stages.
CX in debt delinquency
Organizations need to perform collection activities at the expense of retention. Businesses may tend to write off delinquent customers rather than treat collections as a significant part of customer lifecycle activity. Negative CX with the debt collection reflects anger, fear, and stress, only intensifying when you ask customers about their experience with debt collection.
Debt collection challenges for businesses
Debt collectors have their own challenges with debt collection services. Here are just a few you need to focus on,
- Delinquencies are on the rise, even for those rarely at risk or delinquent
- Long economic boom translated into underinvestment, poor focus on debt collection
- Increased regulations put constraints on debt collection activity
- Despite an accelerated shift, they may revert to outdated collection strategies
Enhancing your debt collection process
The move towards digital channels has helped bring the ultimate business transformation. Most debt recovery services are now utilizing this means to improve collection rate. Remember, banks and lenders are now leveraging these customer engagement options. With the right technology, you no longer need to stick to the outdated collection strategy of more calling.
Leverage omnichannel experience
The option to create and develop an omnichannel flow with multichannel, multi-touch sequences replaces outdated mail, email, and voice-only campaigns. Here, it’s more about knowing which channel to use for specific customers depending on where they are in the debt cycle.
Collections can design personalized, sensitive omnichannel strategies to address customers’ diverse preferences. Now, organizations can optimize channel mix, including voice, 2-way SMS, and email, to improve connection rates. You need to refine contact approaches based on responses and behavior.
Personalize increased debt collection rates with a built-in customer data platform
A Customer Data Platform (CDP) is a database that connects all your data sources and gives agents an aggregated global view of demographic, behavioral, transactional and engagement customer data. It is critical to successful debt collection management, just as with engagement at any point in the customer lifecycle.
Debt collection services enable real-time access to action rates. It’s more about extracting the right information. They know exactly where the customers are in their payment lifecycle. It’s more about providing payment solutions to customers at risk or in delinquency. Here’s what you get as a part of the process,
- Real-time check of the latest payment information before triggering a contact
- Context payment history and customer sentiment get pushed to the agent
- Collector gets guided through recovery/assistance steps
- Payment captured with a customer promise
Cultivate a relationship with the customer context
You must reach out to mitigate debt and increase recovery, including assisting customers during financial hardship. The experts from debt recovery services are armed with the latest customer information. Collection agents provide customers with correct, detailed information about the debt owed.
There’s the dialog designer that lets you create, test, and rework automated outbound IVR and email messaging. The agents use live call guide scripts tailored to convey empathy and concern while increasing debt collection rates.
You must go for a solution that empowers debt collectors with rich customer context, emotional signals, and guidance for extended payment terms and options that offers the best possible experience. After-call work automation and smart workflows through campaigns are more about changing and improving agent efficiency.
The efficiency of analytics and AI-guided intelligent collection
Limited resources only increase the importance of meeting efficiency and efficacy goals. The ability to prioritize outreach and maximize the agent pool is critical to successful debt collection. Engagement solutions driven by analytics and artificial intelligence can target with precision and optimize contact and recovery rates.
AI models deliver next-best-action intelligence, generate robust predictions, and uncover performance and connection rate drivers. AI-guided debt recovery campaigns combined with a rich, up-to-date CDP enable you to make predictions such as
- Expected proportion
- Probability to pay the target date
- Recommended reminders
Debt recovery services will look for a rich data model that feeds statistical and predictive models, including the best time to call, the best channel to use, the tendency to pay, and other likely responses to reminders.
Customer-specific collection strategies
The latest built-in Customer Data Platform helps you assemble comprehensive customer profiles, including transaction history, payment records, and past interactions. There are both soft and aggressive collection contact methods and everything in between. Which method to use, when, and for whom can be determined with correct segmentation and predictive modeling capabilities.
Customer Data Platforms with AI and analytics provide the foundation for segmentation and predictive models. You must look for the ability to segment debtors based on responsiveness to payment reminders, tailoring engagement workflows, and increasing debt collection rates. The combination delivers customer-specific collection strategies.
Go for featured dialers
Running a live call with customers to offer support and discuss payment options as part of the engagement mix is still one of the best options to improve debt collection outcomes. A full-featured auto dialer is integral to a successful outreach of customers at risk for delinquency. It’s more about enhancing connection and collection rates.
With predictive dialing, you have the option to increase your reach of at-risk or in-debt customers by four times. Now, agents can spend more time assisting distressed customers, discussing payment options, and cultivating relationships.
You must look for a solution that can easily overlay and integrate as per the business demand. Then, go with a professional firm to make a difference. We can help you with all your challenges.