Data analysis produces richer insights
These positive experiences are a result of digital agencies such as InDebted better leveraging the data they collect to build behavioural models of their clients’ customers. InDebted’s data models store all customer interactions onto a platform where analysis is conducted to learn about the individual preferences of each customer, right down to how they like to be contacted.
This analysis helps the digital platform determine what action to take at each step of the interaction with the customer. It also means InDebted can develop much better relationships with its clients’ customers, and do so at scale – a situation that benefits the organisation through more satisfied customers and a more efficient recoveries process.
“We believe that debt collection is not about cost savings but about implementing efficiencies that allow our clients to recover more.”
InDebted CEO Josh Foreman says being end-to-end digital means customers don’t need to spend as much time and effort resolving their accounts. “Our clients ultimately benefit because their customers are less stressed. The more positive the engagement, it should ultimately mean more money is recovered. We believe debt collection is not about cost savings but about implementing efficiencies that allow our clients to recover more.”
Digital debt collection also reduces the number of errors made throughout the process. Foreman says around 95% of compliance breaches occur when people are involved in the process. “Having a digital offering where the system checks all communications are going to the correct person with the right message means any risk exposure is reduced.”
Around the world it’s common for debt collectors to be remunerated based on the amount of money they recover. But with InDebted, staff are remunerated according to how they deal with customers – a strategy that eliminates the risk of staff being motivated by commissions. “Our staff are incentivised to spend time taking care of the clients’ customers and this is another factor that should reduce any reputational risk to an organisation,” Foreman says.
How InDebted Deals with these Uncertain Times
Many customers and businesses worldwide have had their income and revenue severely impacted by the pandemic. Retrieving unpaid bills is one of life’s necessities for organisations but in these uncertain times a change to the traditional model is required. Organisations need to show greater empathy to those customers who are struggling financially - often through no fault of their own.
In some jurisdictions during the pandemic governments implemented constraints on the collection of debts. However, as many economies move to recovery mode, organisations are ramping up their efforts to recover unpaid accounts. This means there is a greater need for the services of debt collection agencies. But traditional agencies that rely on call centre operators to recover monies will unlikely keep up with the demand or the needs of customers, especially when debts are owed to a number of different organisations.
Digital debt collection agencies are now the only option for organisations wanting to ensure a positive, supportive and human experience for their customers.
InDebted’s digital offering is more able to deal with these new demands. Customers now expect to use their channel of choice for any communication with the organisations they deal with and want to be able to access it 24/7. By providing this service, InDebted best caters to the needs of customers while reducing the cost and speed of collections for its clients.
COVID-19 has brought with it a new way of doing business including bringing digital processes into every interaction organisations have with their customers. Digital channels are now the primary means of engagement and this extends to debt collection.
If organisations want to retain their customer base, along with their brand reputation, it’s important to engage in the way the world is now operating. The relationship organisations have with their customers is now a digital one and this is why a digital approach should also apply to debt recovery: digital debt collection agencies are now the only option for organisations wanting to ensure a positive, supportive and human experience for their customers.
Global financial effects of COVID-19
The effect COVID-19 has had on business revenue and customers’ finances around the world makes for grim reading. In Australia, a survey by the Australian Institute of Family Studies found many Australians experienced changes to their employment including “job losses, stand downs and reductions in working hours”. This led to a large number of families experiencing changes to their income with just over 30% reporting a reduction, and 19% saying it had reduced “a lot”.
Australian businesses were similarly affected. The Australian Bureau of Statistics reported in March 2021 that one in five (22%) businesses recorded a fall in revenue and 8% expected decreased revenues in April.
In the USA, research from the Pew Research Center found about half of working adults believe the economic impact of COVID-19 will make it harder for them to achieve their long-term financial goals. Among those who say the pandemic has led to their worsening financial situation, 44% think it will take them three years or more to get back to where they were a year ago – including one in 10 who don’t think their finances will ever recover.
And while some larger US corporations have performed well during the pandemic, small businesses were hit hard with 31% currently deemed to be non-operational.
The United Kingdom recorded a record 370,000 redundancies between August and November and of those in work in February 2020, about 45% lost earnings in the first few months of the crisis. The number claiming universal credit – a payment to assist with living costs – more than doubled to 5.7 million by November 2020.
From a business standpoint, statistics from the Bank of England found while sales were slowing improving they remain markedly down from what would have been the case in the absence of COVID-19.
New Zealand is showing signs of recovery of levels of personal income although one in three households say they have not recovered their incomes to the February 2020 levels, including 11% of households still on a severely reduced income. COVID-19 has had a significant impact on business revenue, especially with the country’s hard lockdowns during the year. The Organisation for Economic Co-operation and Development found business investment will be “anaemic” as businesses seek to consolidate their balance sheets and build up cash buffers to cope with the economic fallout from potential future virus outbreaks.