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Is a Great Debt Collection Experience an Oxymoron?

Debt collection is at the intersection of two very popular news stories: the continuing shift of global wealth, and the rise of customer experience as the defining characteristic of successful companies.

Here’s where debt collection comes in. While the world’s richest are getting richer, many consumers have not. Many formerly affluent and middle-class people are struggling financially.  Many of them are, for the first time, finding it a serious challenge to make timely payments on debt obligations.

Still, consumers expect every experience to be a great one – including collection efforts.

Banks and other credit issuers have gone to extraordinary lengths to create mobile apps that let customers deposit checks with just a photo, have enabled ApplePay, and more. Card providers alert consumers with a text message when they suspect a fraudulent transaction. Consumers love it. So why do so many debt collection efforts consist of calls from an automated system or collector?

A changing landscape for collections

In the US, collections is a heavily regulated activity, with strict rules for every aspect of the interactions banks have with consumers.

However, within regulatory parameters, organizations are using innovative new technologies to communicate with customers on collection issues in ways that don’t just raise customer satisfaction – they increase the amounts of recovered debt as well.

New technologies bring a human touch

These technologies include solutions like FICO® Risk Intervention Manager,  which organizations collecting debt use to communicate with customers individually, at scale. These systems deliver intelligent, scalable, two-way, automated voice, text, email and mobile app notifications, with a human touch.

When customers have late or missed payments, they get a text message, email or call, according to their preference. All of these channels have a “make a payment now” option that allows consumers to address their debt easily and immediately. Because communications are automated, regulatory compliance is assured. When one of the world’s largest electric utility companies surveyed its customers, 61% said they preferred an automated contact (voice, email or SMS) over dealing with collection agents.

And when collectors DO make a call, FICO® Engagement Analyzer helps maintain compliance and collection effectiveness. It uses sophisticated text and speech recognition analytics to index, search, analyze and report content from high volumes of collector interactions. This can help the collector respond better to what the debtor is saying, so resolution is speedier, which makes the collector and the debtor more satisfied.

An unexpectedly great experience

Across every industry and demographic, FICO helps organizations take a holistic view of collections, a critical part of the credit lifecycle. We’re working hard to help collection organizations operate efficiently while – dare I say it? – providing a great customer experience.

For more on this topic, see our fun infographic on customer-centric collections.

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