Tag: communications

Automation, artificial intelligence and machine learning are at the forefront of the continued digital transformation within the world of collections. And organizations from across industries — including healthcare, financial services and the public sector — are learning how automated debt collection can improve their workflows and strategies. When implemented well, automation can ease pressure from call center agents, which can be especially important when there's a tight labor market and retention is top of mind for every employer. Automated systems can also help improve recovery rates while minimizing the risk of human error and the corresponding liability. These same systems can increase long-term customer satisfaction and lifetime value. Deeper insights into consumers' financial situations and preferences allow you to avoid wasting resources and making contact when consumers are truly unable to pay. Instead, monitoring and following up with their preferred contact method can be a more successful approach — and a better experience for consumers. Three tips for automated debt collection Automation and artificial intelligence (AI) aren't new to collections. You may have heard about or tried automated dialing systems, chatbots, text message services and virtual negotiators. But the following three points can be important to consider as the technology and compliance landscapes change. 1. Good automation depends on good data Whether you're using static automated systems to improve efficiencies or using a machine learning model that will adapt over time, the data you feed into the system needs to be accurate. The data can be internal, from call center agents and your customers, and external sources can help verify and expand on what you know. With your internal systems, consider how you can automate processes to limit human errors. For example, you may be able to auto-fill contact information for customers and agents — saving them time and avoiding typos that can cause issues later. External data sources can be helpful in several ways. You can use third-party data as a complementary resource to help determine the best address, phone number or email address to increase right-party contact (RPC) rates. External sources can also validate your internal data and automatically highlight errors or potentially outdated information, which can be important for maintaining compliance. Robust and frequently updated datasets can make your collection efforts more efficient and effective. An automated system could be notified when a debtor resurfaces or gets a new job, triggering new reminders or requests for payment. And if you're using the right tools, you can automatically route the account to internal or external servicing and prioritize accounts based on the consumer's propensity to pay or the expected recovery amount. LEARN MORE: Advanced analytics involves using sophisticated techniques and tools to analyze complex datasets and extract valuable insights. Learn about the benefits of advanced analytics in delinquent debt collection. 2. Expand consumers' communication options and choices Your automated systems can suggest when and who to contact, but you'll also want them to recommend the best way to contact consumers. An omnichannel strategy and digital-first approach is increasingly the preferred method by consumers, who have become more accustomed to online communications and services. In fact, companies with omnichannel customer engagement strategies retain on average 89% of their customers compared to 33% of retention rates for companies with weak omnichannel strategies. Organizations can benefit by using alternative communication methods, such as push notifications, as part of an AI-driven automated process. These can be unobtrusive reminders that gently nudge customers without bothering them, and send them to self-cure portals. Many consumers may need to review the payment options before committing — perhaps they need to check their account balances or ask friends or family for help. Self-service options through an app or web portal can give them choices, such as a single payment or payment plan, without having to involve a live agent. 3. Maintaining compliance must be a priority Organizations need to be ready to adjust to a rapidly changing compliance environment. Over the last few years, organizations have also had to react to changes that can impact Telephone Consumer Protection Act (TCPA) compliance. The automated systems you use should be nimble enough to comply with required changes, and they should be able to support your overall operation's compliance. In particular, you may want to focus on how automated systems collect, verify, safeguard and send consumers' personal information. Why partner with Experian? Whether you're looking to explore or expand your use of automated systems in your collection efforts, you want to make sure you're taking the right approach. Experian helps clients balance effective collections and a great customer experience within their given constraints, including limited budgets and regulatory compliance. The Experian Ascend Intelligence Platform and award-winning PowerCurve® Collections solutions are also making AI-driven automated systems accessible to more lenders and collectors than ever before. Taking a closer look at Experian's offerings, we can focus on three particular areas: Industry-leading data sources Experian's data sources go well beyond the consumer credit database, which has information on over 245 million consumers. Clients can also benefit from alternative financial services data, rental payment data, modeled income estimates, information on collateral and skip tracing data. And real-time access to information from over 5,000 local exchange carriers, which can help you validate phone ownership and phone type. Tools for maximizing recovery rates Experian helps clients turn data into insights and decisions to determine the best next step. Some of Experian's offerings include: Collection AdvantageSM: A one-stop shop for comprehensive and efficient debt collection, Collection AdvantageSM allows you to segment, prioritize and make contact on collections accounts by leveraging speciality collection scoring models. PriorityScore for CollectionsSM: Over 60 industry-specific debt recovery scores that can help you prioritize accounts based on the likelihood to pay or expected recovery amount. RecoveryScore 2.0: Helps you prioritize charged-off accounts based on collectability. TrueTrace™ and TrueTrace Live™: Find consumers based on real-time contact information. We've seen a 10 percent lift in RPC with clients who use Experian's locating tools, TrueTrace or TrueTrace Live. Collection Triggers℠: Sometimes, waiting is the best option. And with an account monitoring tool like Collection Triggers℠, you'll automatically get notified when it makes sense to reach out. RPC contact scores: Tools like Phone Number ID™ and Contact Monitor™ can track phone numbers, ownership and line type to determine how to contact consumers. Real-time data can also increase your RPC rates while limiting your risk. LEARN MORE: See how Collection Triggers can help you establish a more profitable debt collection strategy to increase recovery rates. You can use these, and other, tools to prioritize collection efforts. Experian clients also use different types of scores that aren't always associated with collections to segment and prioritize their collection efforts, including bankruptcy and traditional credit-based scores. Custom models based on internal and external scores can also be beneficial, which Experian can help you build, improve and house. Prioritize collections activities with confidence Collections optimization comes down to making the right contact at the right time via the right channel. Equally important is making sure you're not running afoul of regulations by making the wrong contact. Experian's data standards and hygiene measures can help you: Identify consumers who require special handling Validate email addresses and identify work email addresses Get notified when a line type or phone ownership changes Append new contact information to a consumer's file Know when to reach out to consumers to update contact information and permissions Recommend the best way to reach consumers Automated tools can make these efforts easier and more accurate, leading to a better consumer experience that increases the customer's lifetime value and maximizes your recovery efforts. Learn more

Achieving collection results within the subprime population was challenging enough before the current COVID-19 pandemic and will likely become more difficult now that the protections of the Coronavirus Aid, Relief, and Economic Security (CARES) Act have expired. To improve results within the subprime space, lenders need to have a well-established pre-delinquent contact optimization approach. While debt collection often elicits mixed feelings in consumers, it’s important to remember that lenders share the same goal of settling owed debts as quickly as possible, or better yet, avoiding collections altogether. The subprime lending population requires a distinct and nuanced approach. Often, this group includes consumers that are either new to credit as well as consumers that have fallen delinquent in the past suggesting more credit education, communication and support would be beneficial. Communication with subprime consumers should take place before their account is in arrears and be viewed as a “friendly reminder” rather than collection communication. This approach has several benefits, including: The communication is perceived as non-threatening, as it’s a simple notice of an upcoming payment. Subprime consumers often appreciate the reminder, as they have likely had difficulty qualifying for financing in the past and want to improve their credit score. It allows for confirmation of a consumer’s contact information (mainly their mobile number), so lenders can collect faster while reducing expenses and mitigating risk. When executed correctly, it would facilitate the resolution of any issues associated with the delivery of product or billing by offering a communication touchpoint. Additionally, touchpoints offer an opportunity to educate consumers on the importance of maintaining their credit. Customer segmentation is critical, as the way lenders approach the subprime population may not be perceived as positively with other borrowers. To enhance targeting efforts, lenders should leverage both internal and external attributes. Internal payment patterns can provide a more comprehensive view of how a customer manages their account. External bureau scores, like the VantageScore® credit score, and attribute sets that provide valuable insights into credit usage patterns, can significantly improve targeting. Additionally, the execution of the strategy in a test vs. control design, with progression to successive champion vs. challenger designs is critical to success and improved performance. Execution of the strategy should also be tested using various communication channels, including digital. From an efficiency standpoint, text and phone calls leveraging pre-recorded messages work well. If a consumer wishes to participate in settling their debt, they should be presented with self-service options. Another alternative is to leverage live operators, who can help with an uptick in collection activity. Testing different tranches of accounts based on segmentation criteria with the type of channel leveraged can significantly improve results, lower costs and increase customer retention. Learn About Trended Attributes Learn About Premier Attributes

Earlier this year, the Consumer Financial Protection Bureau (CFPB) issued a Notice of Proposed Rulemaking (NPRM) to implement the Fair Debt Collection Practices Act (FDCPA). The proposal, which will go into deliberation in September and won't be finalized until after that date at the earliest, would provide consumers with clear-cut protections against disturbance by debt collectors and straightforward options to address or dispute debts. Additionally, the NPRM would set strict limits on the number of calls debt collectors may place to reach consumers weekly, as well as clarify how collectors may communicate lawfully using technologies developed after the FDCPA’s passage in 1977. So, what does this mean for collectors? The compliance conundrum is ever present, especially in the debt collection industry. Debt collectors are expected to continuously adapt to changing regulations, forcing them to spend time, energy and resources on maintaining compliance. As the most recent onslaught of developments and proposed new rules have been pushed out to the financial community, compliance professionals are once again working to implement changes. According to the Federal Register, here are some key ways the new regulation would affect debt collection: Limited to seven calls: Debt collectors would be limited to attempting to reach out to consumers by phone about a specific debt no more than seven times per week. Ability to unsubscribe: Consumers who do not wish to be contacted via newer technologies, including voicemails, emails and text messages must be given the option to opt-out of future communications. Use of newer technologies: Newer communication technologies, such as emails and text messages, may be used in debt collection, with certain limitations to protect consumer privacy. Required disclosures: Debt collectors will be obligated to send consumers a disclosure with certain information about the debt and related consumer protections. Limited contact: Consumers will be able to limit ways debt collectors contact them, for example at a specific telephone number, while they are at work or during certain hours. Now that you know the details, how can you prepare? At Experian, we understand the importance of an effective collections strategy. Our debt collection solutions automate and moderate dialogues and negotiations between consumers and collectors, making it easier for collection agencies to reach consumers while staying compliant. Powerful locating solution: Locate past-due consumers more accurately, efficiently and effectively. TrueTraceSM adds value to each contact by increasing your right-party contact rate. Exclusive contact information: Mitigate your compliance risk with a seamless and unparalleled solution. With Phone Number IDTM, you can identify who a phone is registered to, the phone type, carrier and the activation date. If you aren’t ready for the new CFPB regulation, what are you waiting for? Learn more Note: Click here for an update on the CFPB's proposal.

Have you seen the latest Telephone Consumer Protection Act (TCPA) class action lawsuit? TCPA litigations in the communications, energy and media industries are dominating the headlines, with companies paying up to millions of dollars in damages. Consumer disputes have increased more than 500 percent in the past five years, and regulations continue to tighten. Now more than ever, it’s crucial to build effective and cost-efficient contact strategies. But how? First, know your facts. Second, let us help. What is the TCPA? As you’re aware, TCPA aims to safeguard consumer privacy by regulating telephone solicitations and the use of prerecorded messages, auto-dialed calls, text messages and unsolicited faxes. The rule has been amended and more tightly defined over time. Why is TCPA compliance important? Businesses found guilty of violating TCPA regulations face steep penalties – fines range from $500 to $1500 per individual infraction! Companies have been delivered hefty penalties upwards of hundreds of thousands, and in some cases, millions of dollars. Many have questions and are seeking to understand how they might adjust their policies and call practices. How can you protect yourself? To help avoid risk for compliance violations, it’s integral to assess call strategies and put best practices in place to increase right-party contact rates. Strategies to gain compliance and mitigate risk include: Focus on right and wrong-party contact to improve customer service: Monitoring and verifying consumer contact information can seem like a tedious task, but with the right combination of data, including skip tracing data from consumer credit data, alternative and other exclusive data sources, past-due consumers can be located faster. Scrub often for updated or verified information: Phone numbers can continuously change, and they’re only one piece of a consumer’s contact information. Verifying contact information for TCPA compliance with a partner you can trust can help make data quality routine. Determine when and how often you dial cell phones: Or, given new considerations proposed by the CFPB, consider looking at collections via your consumers’ preferred communication channel – online vs. over the phone. Provide consumers user-friendly mechanisms to opt-out of receiving communications At Experian, our TCPA solutions can help you monitor and verify consumer contact information, locate past-due consumers, improve your right-party contact rates and automate your collections process. Get started