As debt collection moves into the digital age, it’s valuable to take a holistic view of which elements can be leveraged to maximise results. There are plenty of areas to focus on of course, but these four factors have the potential to take digital to another level in terms of participation, efficiency and effectiveness. If these key areas work harmoniously, digital collections will work for more customers more efficiently and with better, measurable outcomes.
1. Customer demand
“If you want people to engage with you in collections, you’ve got to be realistic that people are less likely to pick up the phone and call you back or even answer the phone”
Today, with contactless payments overtaking chip and pin for the first time and smartphone ownership rising in all age groups, there is a discernible ‘rush to digital’ in collections, driven by customer demand. The biggest single factor is the spectacular decline of the voice call but whereas some see digital as the end game of this trend, in reality, it’s just the starting point.
Customers expect digital systems that respond to their input and react intelligently, this is what we’re used to across our online interactions.
Collections has moved away from the concept of customers as stagnant, average entities and is building engagements that better reflect the diverse, fluctuating nature of human lives rather than being ‘designed for the ideal’. There is a particular need for this when debt so often overlaps with complex circumstances like mental health challenges or big life changes. It’s unlikely that box-ticking is going to be enough to meet increasing regulation or satisfy customer demand.
2. User Experience Design
“A quick, painless experience to set up a plan or pay what you owe and you can get on with the rest of your life”
As debt collection systems haven’t previously been customer-facing, user experience design (UXD) hadn’t been a high priority, until now. It is crucial that digital engagement can cater for non-average customers and provide reasonable adjustments to increase accessibility. Customers’ tolerance of poor design is low and high drop-out rates only load the cost back onto contact centres. UXD also has a key role in delivering a collaborative approach and connecting with customers through an empathetic and encouraging journey.
Where affordability is an issue, bringing in the option to authorise Open Banking to make income and expenditure a quicker, more accurate procedure may prove popular. It’s a difficult one to predict but underestimating the public’s appetite for change can leave organisations playing catch up. Debt advice bodies are getting behind Open Banking as a force for good and promoting the mutually beneficial exchange of information in return for improved understanding and personalised service.
UXD is not only about neat-looking interfaces; it can be measured in terms of increased participation, lower cost to serve and more positive outcomes.
3. Machine Learning
“We want things to be easy to use and to be organised around what’s known about us”
After some initial scepticism, every progressive business is now looking at ways to leverage machine learning to improve customer service and profitability. This is a rapidly developing technology and there are exciting opportunities to increase personalisation based on what is known about each individual customer. This could be as straightforward as directing customers with a high propensity to self-resolve toward a digital payment option without the need to involve contact centre agents.
“Collections hasn’t always been something to invest hard earned money in because where’s the return?”
Collections teams can utilise transactional data and usage information via web analytics and machine learning to inform decisions and continually feed new insights back into updates and improvements. The value of this data is that it comes directly from the experiences of customers and agents within the organisation, it’s always up to date and it isn’t reliant on assumptions from outside sources or general data cohorts.
Armed with this knowledge, the agile nature of digital technology makes it infinitely easier for businesses to quickly test and implement changes according to what is known about the customer journey and what works in any one organisation. This is a sea change from the days of investing in legacy software that couldn’t be replaced or updated until the next major IT spending round.
If we can achieve a balance and a synergy between the most leverageable aspects of digital collections it can reap definable and measurable benefits to both customer and creditor. Moving to digital without fully realising the possibilities would be a missed opportunity and in just a brief period of time, the shortfall would be painfully obvious. As digital technology has the ability to continually improve and update as a matter of course, these benefits can be incremental, adjusted, personalised and expanded without fuss.