Debt collection practice is quite appreciated by the creditors who are regularly dealing with bad debts and delinquent accounts. However, the world of collections has changed a lot, and new trends are being incorporated in 2022. Here we will discuss a few facts that will impact your business and debt collection this year.
Moving to Digital World
It is no surprise that people are shifting to the digital routes while doing their businesses. This is true everywhere and in every industry. For example, 41% of banking customers use digital ways and their satisfaction obviously has increased with the banking experience. The non-cash payment has increased up to 32% and there is a general sense of ‘pay later’ when people use credit cards. Abundant use of credit cards and other debts impacts how the customers will repay their debts.
Reg. F in Effect
The FDCPA impacted the strategies of the debt collection business and how the third party debt collectors will conduct with the debtors. The last amendment of the act now allows the creditors to use email, social media, text message, ringless voicemail, and other modes of communication to contact the debtors.
More People in Call Centers
This is not a necessary trend to follow by the debt recovery agencies but surely this is a trend to have impacts on debt collection for all the good reasons. The call centers would create job openings across the country and it means the businesses will create more effective and better ways for resolving debts by contacting the debtors. The call centers use the latest technologies to increase the agents’ productivity of call answering and payment negotiation.
Mandatory Customer Self-Service
Self-service advancements will be mandatory to implement, therefore, it will allow the debtors to respond to a raised issue at their preferred time. Sometimes, they do not need to talk to anyone and they are more likely to find a solution for debt payment.
To contact the customers, an effective way is to implement voicemail. This is safe, clear, and compliant with FDCPA. The voicemail can be personalized and quickly reach a vast customer base. The voicemail will help the customers get the picture better and make payments on their own time and a better customer experience.
Apply multichannel customer service strategy
The debtors always like to get contacted by digital channels but a smaller segment is more responsive to the traditional contact methods than the new ones. This trend is restricted to a particular age group and an outstanding amount.
The debtors with low delinquent account balances or the low-risk debtors always choose digital communication channels like text or email than speaking over a phone with a bank employee. The preference for the traditional forms rises with the delinquent balance. The analog communication ways are more preferred by the customers of a preferred age group.
For creating a successful multichannel strategy for contacting the debtors, three things are necessary – automation, data analytics, and infrastructure or one solution that combines these three.
Highly Customized and Personalized Service
There has to be a personal approach to be included in the debt collection strategy by the third party debt collectors for the next years and 2022. This may sound a little tough, but this is easy as anything with ready data and the right tools.
This is about leveraging data sources to get the full image of the customers, so the service can be tailored along with communication according to individual needs. You can also use the customers’ data to improve the decision-making process.
An advanced data analytics solution can help in segregating the customers with a higher default chance of debts depending on the life situation and debt history. Next, the analytics and data can be used to create customized repayment plans with customized installment schedules, adjusted installments, and payments according to the convenience of the debtor.
The third-party debt collectors are the right person to contact when you are in a cumbersome condition. While appointing a collection agency for your debt recovery, check who is using the latest technology and follow the trends of 2022.