A couple of weeks ago I posted a blog that talked about why I feel traditional debt collection agencies are a thing of the past. The purpose of that post was not to belittle the industry of debt collection, more to highlight that many debt collectors still use traditional methods to recover unpaid invoices. If they continue, they may not survive if they do not digitally transform.
Across all industries there are many examples of companies who dominated their space. Kodak and Nokia were two leading companies in their industry, however both lost market dominance due to a lack of vision and not embracing the digital change happening around them.
So, are debt collection agencies next for disruption? I think so.
Let's begin with what is driving this change.
The Capgemini research institute recently published their consumer behaviour survey 2022. Despite this being about consumer behaviour, they did note that similar behaviours were seen with individuals in the context of business.
Individual behaviour is accelerating digitisation. You only need to look at the last 18 months to see that this is true:
Increase in self-service solutions and apps.
Increase in usage of automated voice assistants and chatbots.
Rise in digital payment solutions.
Increase in the usage of mobile applications.
So, what are the megatrends disrupting the debt collection industry?
New technology is not only causing the change but also providing ways to modernise the service of debt recovery.
Robotic automation enables debt collection agencies to improve data quality.
Poor data in, is a poor result out (ok, there is a different way to say this ). Fact is data quality remains a massive challenge for many debt collections agencies and let's be honest, their clients as well.
Whether a client has the correct format for telephone numbers, to understanding if an email address has strong spam filters, these are just some of the many data challenges they face in establishing contact.
However, with robotic automation and machine learning, companies are not only able to change how data is collected and organized, it can also change how data is verified and new data is sourced.
At DebtCo, our digital collections platform has its own compliance engine. At the client level, we can define settings on how we match the data as well as verify it. Using the "If this, then what" methodology, we can automate when the machine looks for new data after verifying what it has is good, or not.
For a human to perform this is costly and is prone to errors. Automating it means we not only reduce human error, but it can also manage at scale for the high-volume debt collection portfolios.
Conversational AI helps debt collection agencies to stand out in all interactions with debtors.
An automated, multichannel conversational AI solution can easily be integrated in the service and support of any company. This new approach is customer-friendly and a far more cost-effective method for case questions, payment reminders and so much more.
At DebtCo we saw a +60% reduction in manual activity after implementing Charlie, our conversational AI bot. Charlie provides a user-friendly, thoughtful, and appropriate response to users. Helping them to manage their cases, answers questions, and even provides guidance on how to manage their cases all via our FinView app.
Even better, Charlie continuously learns. Improving the conversation.
Self-service apps that empower debtors to take control, in their own time.
The use of mobile apps as a self-service solution has skyrocketed over the past few years. E-commerce to customer support, the mobile app presents significant opportunities for companies to provide a more efficient 24/7 service, without having to hire extra staff.
Digital debt collection agencies are all about giving control. Providing an online solution that empower individuals or companies in better managing their finances. Removing the need to send an email or pick up the phone, we provide a solution for those that bury their heads in the sand.
How? By using a mobile app, they can view their case, make a digital payment, setup their own payment plan as well as be presented with multiple options to make contact. Via a channel of their choice. Literally a 24/7 service in the palm of their hands.
With an increase of more than 40% in self-services solutions, going mobile is the way forward and we at DebtCo are at the front of the digital debt collections space with our app, FinView.
To wrap up
I strongly believe that we are witnessing the biggest transformation in the history of debt collections. We all see the daily news which shows that the economic forecast is not looking good. Having a clear process for recovering unpaid invoices via a digital process will make the difference. It takes into consideration the changing needs of individuals and removes the awkward barrier many faces when having to interact with a debt collection agency.
DebtCo is the only all-service digital collection company you need for your payment collection woes. We have developed an innovative digital debt collection platform that can take care of all your collection problems, regardless of your industry. You can reach out to us at 01376 800 592 or request a meeting to know more.