Debt Collection & Recovery
In part one of my blog series, I described the challenges facing collection organizations during the Coronavirus pandemic, limitations on collection activities, staffing challenges, and constantly changing regulations.
When collection activities resume, consumers who deferred payments are likely to be even further in debt, with an even harder time repaying their obligations. In addition, there will be many consumers who never would have been in debt if not for the COVID-crisis. Collection departments and third-party agencies may be also challenged because of social distancing rules to ramp up staff resources to work all of the debts.
However, despite these limitations, there will be contractually or legally mandated contacts which must be made, customer service levels which will need to be maintained, and revenue targets which need to be achieved.
Efficiencies through Automated Communications
To improve their ability to interact with more consumers without adding staff, organizations will likely look for automated communication methods to contact consumers. This will be especially true in the post-pandemic period when the accounts are ramping up. The good news is that most consumers already are used to these communication methods:
- Web Portals
- SMS
Advanced, automated communication will allow organizations to reach more consumers with fewer agents. While these tools are used in the industry today, the biggest impediment in this regard are the Fair Debt Collection Practices Act (FDCPA) rules. The FDCPA was originally passed in 1977, long before current methods of communication were available, and is in urgent need of updates, which the industry has been eagerly waiting. These updates will hopefully be made available in 2020 to allow for these communications.
